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Problem:

Assume Company XYZ finances its capital projects using only long-term debt and common equity. Consequently, its capital structure consists of only long-term debt and common equity. If XYZ's market value of equity exceeds its book value and its bonds sell at par value, its market-based capital structure has a higher percentage of debt than the capital structure calculated using its accounting-based values.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91174674

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