Question: a company has positive net income and no debt if...
A company has positive net income and no debt. If the effective tax rate of the company were to instantaneously change from 30% to 20%. Which of the following statements is (are) TRUE:
I. FCFF would increase
II. FCFE would increase by the same amount as FCFF
III. WACC would increase
C. I, III
D. I, II, III
E. None of the statements