REVIEW FOR FINAL

Correct answer for the questions is C

Explain why this is and how it is determined in detail

If a firm increases its use of financial leverage, then what would we generally expect for the shareholders of that firm to lower their demand for return on their investment. remain indifferent with respect to their return on investment. increase their demand for return on their investment. it is not possible to tell what will happen. Everything else being equal a higher corporate tax rate... will increase the WACC of a firm with debt and equity in its capital structure will not affect the WACC of a firm with debt in its capital structure will decrease the WACC of a firm with some debt in its capital structure will decrease the WACC of a firm with only equity in its capital structure