Question: The interest tax shield is a key reason why: A. the value of an unlevered firm is equal to the value of a levered firm.

The interest tax shield is a key reason why:

A. the value of an unlevered firm is equal to the value of a levered firm.

B. the net cost of debt to a firm is generally less than the cost of equity.

C. the cost of debt is equal to the cost of equity for a levered firm

D. the required rate of return on assets rises when debt is added to the capital structure

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