Which of the Following Statements Is Most Correct

question 58

Multiple Choice

Which of the following statements is most correct?

• A) The weighted average cost of capital for a given capital budget level is a weighted average of the marginal cost of each relevant capital component which makes up the firm's target capital structure.
• B) The weighted average cost of capital is calculated on a before-tax basis.
• C) An increase in the risk-free rate is likely to increase the marginal costs of both debt and equity financing.
• D) Answers a and c are correct.
• E) All of the answers above are correct.

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Definitions:

Quaternary

Relating to the most recent period of the geological time scale, which follows the Tertiary period and encompasses the current time.

Hemoglobin

A molecule found in red blood cells responsible for transporting oxygen from the lungs to the tissues throughout the body and bringing carbon dioxide from those tissues back to the lungs.

Metabolism

This is the set of life-sustaining chemical reactions in organisms, involving the conversion of food to energy, the elimination of nitrogenous wastes, and the synthesis of necessary compounds.

Triglycerides

A type of fat found in the blood, originating from foods or produced by the body, used for energy storage.