Which of the Following Statements Is Most Correct

question 6

Multiple Choice

Which of the following statements is most correct?

• A) If a company's tax rate increases but the yield to maturity of its noncallable bonds remains the same, the company's marginal cost of debt capital used to calculate its weighted average cost of capital will fall.
• B) All else equal, an increase in a company's stock price will increase the marginal cost of common stock, rs.
• C) All else equal, an increase in interest rates will decrease the marginal cost of common stock, rs.
• D) Answers a and b are correct.
• E) Answers b and c are correct.

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Definitions:

Policy Change

An alteration or adjustment to existing rules, guidelines, or protocols within an organization or institution.

Reader-centered Language

Writing or speaking focused on engaging the reader's interest and addressing their needs, questions, or interests.

Adjustment

A process of adapting or becoming used to a new situation.

We-viewpoint

A perspective in communication that emphasizes inclusivity and collective action or responsibility.