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    If return on Investment is high, increased use of debt, is likely to ____________ the over-all cost of capital of the firm provided that the cost of e
    Question

    If return on Investment is high, increased use of debt, is likely to ____________ the over-all cost of capital of the firm provided that the cost of equity remains unaffected.

    A.

    Reduce

    B.

    Increase

    C.

    Double

    D.

    Maximise

    Correct option is A

    If return on Investment is high, increased use of debt, is likely to reduce the over-all cost of capital of the firm provided that the cost of equity remains unaffected.

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