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Why not use debt financing if debt increases value

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For this week's discussion, respond to the following:

The supplemental materials describe the process of calculating WACC and go on to apply the results to valuing a firm both unlevered (no debt) and levered (debt). The levered firm is shown to be more valuable. Two identical firms (see the supplemental materials) and the firm with the debt is more highly valued. Does this make sense? Why or why not? Why not use 100% debt financing if debt increases value?
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Reference no: EM131768105

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