Consider the following statement by a ﬁnancial manager: "Since we are ﬁnancing our new
manufacturing facility 100% with equity, we must evaluate it using a higher rate of return than we
would if we ﬁnanced a portion of the facility with debt." Do you agree? Why or why not? Be sure to
fully explain the rationale behind your argument.

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The Answer of Consider the following statement by a ﬁnancial manager: "Since we are ﬁnancing our new
manufacturing facility 100% with equity, we must evaluate it using a higher rate of return than we
would if we ﬁnanced a portion of the facility with debt." Do you agree? Why or why not? Be sure to
fully explain the rationale behind your argument.

Consider the Following Statement by a ﬁNancial Manager: "Since We