You are advising a large all-equity financed firm. They are considering adding debt to their...
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You are advising a large all-equity financed firm. They are considering adding debt to their capital structure. At present, return on invested capital (ROIC) for the firm is 12% and the likely after-tax cost of debt financing is 14%. Would you advise the firm to add debt to its capital structure? Explain your answer.
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