Which of the following are guidelines for the three methods of capital budgeting with leverage?
A) Use APV if project's level of debt is known over the life of the project.
B) Use APV if project's level of debt is unknown over the life of the project.
C) Use FTE or WACC if the firm's target debt-to-value ratio applies to the project over its life.
D) Both use APV if project's level of debt is known over the life of the project; and use FTE or WACC if the firm's target debt-to-value ratio applies to the project over its life.
E) Both use APV if project's level of debt is unknown over the life of the project; and use FTE or WACC if the firm's target debt-to-value ratio applies to the project over its life.
Correct Answer:
Verified
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