In Computing the Weighted Average Cost of Capital, the Target

question 2

True/False

In computing the weighted average cost of capital, the target weights are either book value or market value weights based on actual capital structure proportions.

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Definitions:

Contract

A contract recognized by law, involving at least two parties, each with obligations to the other.

Principal

The original amount of money invested or loaned, before interest, or the primary party engaged in a contract or transaction.

Authority

The legal power or right given to an individual or entity to make decisions, and enforce obedience.

Agents

Persons authorized to act on behalf of another, known as the principal, in legal or business matters.