Question: The Beta of the company's equity is likely to decrease following the debt reduction The company's cost of equity will increase because the firm has

The Beta of the company's equity is likely to decrease following the debt reduction The company's cost of equity will increase because the firm has less debt and more equity. The new WACC is 8.6 %. WACC will go down because the company is paying less interest, and thus, the cost of capital decreases

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