Using Market Values Rather Than Book Values for Cost of Capital

question 66

Multiple Choice

Using market values rather than book values for cost of capital computations ensures that the firm:

• A) does not ignore the value of retained earnings.
• B) gets the full value of the debt tax shield.
• C) uses expected rates of return.
• D) will not invest in positive NPV projects.

---

Definitions:

Job Analysts

Professionals who conduct in-depth analysis of job roles and responsibilities to determine employee requirements, performance standards, and the qualifications needed for a job.

Work Process

The sequence of steps or actions taken to accomplish a specific task or objective within a workplace.

KSAOs

Stands for Knowledge, Skills, Abilities, and Other characteristics; a framework used to evaluate an individual's qualifications for a job.

Job Descriptions

Written statements that outline the duties, responsibilities, qualifications, and conditions of a specific job position.