Which of the Following Is a Capital Component for the Purpose

question 50

Multiple Choice

Which of the following is a capital component for the purpose of calculating the weighted average cost of capital in capital budgeting?

• A) The after-tax cost of long-term debt
• B) The after-tax cost of common stock
• C) The after-tax cost of preferred stock
• D) The after-tax cost of retained earnings
• E) The after-tax cost of new equity

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Definitions:

Functional Team

A group of individuals who are organized based on the specific role or function they serve within an organization, such as marketing or finance.

Coordinate Efforts

The organization and alignment of individual actions and resources towards achieving a common objective.

Performing Stage

The stage in group evolution characterized by optimal collaboration, productivity, and synergy among team members.

Danger of Failure

The risk or possibility that a plan, project, or device will not succeed.