Which of the Following Statements Is FALSE

question 21

Multiple Choice

Which of the following statements is FALSE?

• A)The firm's weighted average cost of capital (WACC)denoted r_wacc is the cost of capital that reflects the risk of the overall business,which is the combined risk of the firm's equity and debt.
• B)Intuitively,the difference between the discounted free cash flow model and the dividend-discount model is that in the divided-discount model the firm's cash and debt are included indirectly through the effect of interest income and expenses on earnings in the dividend-discount model.
• C)We interpret r_wacc as the expected return the firm must pay to investors to compensate them for the risk of holding the firm's debt and equity together.
• D)When using the discounted free cash flow model we should use the firm's equity cost of capital.

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Recognize the impact of New Deal policies on civil liberties and minority rights.

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