Question: Please specify whether you agree or disagree with the given arguments and provide the reasons concisely (not exceeding 3 sentences). A computer manufacturer, Doll ,

Please specify whether you agree or disagree with the given arguments and provide the reasons concisely (not exceeding 3 sentences).

A computer manufacturer, Doll, has a plan to build a new plant. To finance the construction cost, Doll considers either issuing stocks or bonds. The cost of debt is 5% and the cost of equity is 10%. The CFO argues, Given that the cost of debt is lower than the cost of equity, we can reduce the required rate of return for our project. Do you agree with the CFO?

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