Impact of risk-free rate increase on cost of debt and cost of equity
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Assume that the risk-free rate increases. What impact would this have on the cost of debt? What impact would it have on the cost of equity?
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This solution discusses what occurs to cost of debt and cost of equity if risk free rate increases. It's 127 words.
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If the risk free rate increases, both the cost of debt and cost of equity will increase.
Cost of Debt: Cost of debt will increase because the risk free rate ...
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