Question: QUESTION 25 Which one of the following will decrease the after-tax cost of debt for a firm? an increase in tax rates changing the firm's

QUESTION 25

Which one of the following will decrease the after-tax cost of debt for a firm?

an increase in tax rates

changing the firm's bond rating from A to B

an increase in the risk-free rate of return

an increase in the risk level of the firm

4 points

QUESTION 26

The beta of a diversified portfolio is equal to the _____ of the betas of the individual securities that comprise the portfolio.

arithmetic average

summation

weighted average

geometric average

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