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When firms use multiple sources of capital, they need to calculate the appropriate discount rate for valuing their firm's cash flows as:

a simple average of the capital components costs.

a sum of the capital components costs.

a weighted average of the capital components costs.

they apply to each asset as they are purchased with their respective forms of debt or equity.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M91539081

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