Which One of the Following Is the Primary Determinant of a Firm's

question 96

Multiple Choice

Which one of the following is the primary determinant of a firm's cost of capital?

• A)debt-equity ratio
• B)applicable tax rate
• C)cost of equity
• D)cost of debt
• E)use of the funds

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Definitions:

Co-insurance Clause

A provision in an insurance policy requiring the policyholder to bear a portion of the losses to the extent of a specified percentage.

Fireproof

A characteristic of materials or structures that are resistant to fire and are able to withstand high temperatures without catching fire or sustaining significant damage.

Insured

A person or entity covered by an insurance policy receiving financial protection or reimbursement against losses from an insurance company.

Misrepresentation

A false statement of fact made by one party to another, which has the effect of inducing that party into a contract.