Which of the Following Statements Is Most Correct

question 28

Multiple Choice

Which of the following statements is most correct?

• A)An increase in the corporate tax rate would lower the weighted average cost of capital for an average firm, other things held constant.
• B)Depreciation-generated funds have a cost equal to the firm's lowest WACC, and hence they have no impact on the MCC schedule.
• C)As a firm's debt ratio approaches 100 percent, the after-tax cost of debt, rdT, at its lowest level.
• D)Statements a, b, and c are all true.
• E)Statements a, b, and c are all false.

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Definitions:

Nicholas Biddle

An American financier who served as the president of the Second Bank of the United States, playing a central role in the bank war with President Andrew Jackson.

Economic Privilege

Advantages or benefits in socioeconomic status and access to resources that are available to certain groups or individuals based on their economic position.

Old Northwest

A historical term referring to the region of the United States northwest of the Ohio River, encompassing states like Ohio, Indiana, Illinois, Michigan, Wisconsin, and parts of Minnesota.

Battlefield Resistance

Acts of defiance or opposition by military forces or insurgents during engagements or conflicts on a battlefield.