cash-generating value

1. Explain three forces that can make equity cheaper than debt for corporate financing.
2. If the firm maximizes its value in an imperfect financial market, how would this change its cost of capital?
3. What forces can change the shape of the graph of cost of capital versus leverage?
4. Where do agency considerations appear in the WACC formula? Do agency costs influence the firm’s WACC?
5. If you could design a novel security at the inception of a growth firm that you expect to turn into a cash-generating value firm in 5 years, what would it look like?
6. Is the ability of a firm to stave off financial distress always optimal from the firm-value perspective?