Which of the Following Is Not Considered a Capital Component

question 79

Multiple Choice

Which of the following is not considered a capital component for the purpose of calculating the weighted average cost of capital as it applies to capital budgeting?

• A) Long-term debt.
• B) Common stock.
• C) Short-term debt.
• D) Preferred stock.
• E) All of the above are considered capital components for WACC and capital budgeting purposes.

---

Definitions:

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how spread out the values are from the average.

Standard Deviation

A statistical measure of the dispersion or spread in a set of data, indicating how much variation exists from the average.

Index Fund

A type of mutual fund or exchange-traded fund (ETF) designed to replicate the performance of a specific benchmark index.