Which of the Following Statements Is Correct

question 70

Multiple Choice

Which of the following statements is correct?

• A)The WACC is calculated using before-tax costs for all components.
• B)The after-tax cost of debt usually exceeds the after-tax cost of equity.
• C)Retained earnings that were generated in the past and are reflected on the firm's balance sheet are generally available to finance the firm's capital budget during the coming year.
• D)The WACC that should be used in capital budgeting is the firm's marginal, after-tax cost of capital.

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Definitions:

Philanthropy

The desire to promote the welfare of others, expressed especially by the generous donation of money to good causes.

Charity

An organization set up to provide help and raise money for those in need, focusing on public benefit.

Fundraising

The process of gathering voluntary contributions of money or other resources, typically for non-profit organizations.

Campaigns

Organized efforts aimed at achieving a specific goal, often through awareness-raising, advocacy, fundraising, or marketing activities.