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1 December, 22:00

The after-tax cost of debt:a. varies inversely to changes in the market interest ratesb. will generally exceed the cost of equity if the relevant tax rate is zeroc. will generally equal the cost of preferred if the tax rate is zerod. is unaffected by changes in the market rate of intereste. has a greater effect on a firm's cost of capital when the debt-equity ratio increases

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  1. 1 December, 22:13
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    E. Has a greater effect on a firm's cost of capital when the debt-equity ratio increases.
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