Which of the Following May Be True of the Cost

question 25

Multiple Choice

Which of the following may be true of the cost of debt and cost of equity?

• A) The weighted average cost of capital is computed by assigning weights to the cost of debt and the cost of equity of a firm.
• B) The cost of debt for a firm is always equal to the cost of equity to the firm.
• C) The cost of internally generated equity for a firm is greater than the cost of externally generated equity funds for the firm.
• D) The cost of internally generated equity for a firm is less than the cost of debt for the firm.
• E) The cost of externally generated equity is the sum of the cost of debt and the cost of retained earnings.

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Definitions:

Risky Behaviour

Actions that expose individuals to harm or substantial risk of negative consequences.

Adolescents

Individuals in the transitional stage of human development that occurs between childhood and adulthood, typically between ages 10 and 19.

Early Maturation

The process in which an individual reaches physical and sexual development earlier than the average age for their peer group.

Eating Disorders

Mental disorders characterized by abnormal or disturbed eating habits that negatively affect a person's health.