मराठी

Why is debt cheaper than equity?

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प्रश्न

Why is debt cheaper than equity?

पर्याय

  • Interest is tax-deductible

  • Dividend is paid out of after-tax profits

  • Interest and repayment of principal are compulsory

  • Financial risk increases

MCQ
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उत्तर

Debt is cheaper than equity because interest is tax-deductible. This is the stated reason for its lower cost.

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