On Form 1040,deductions for Adjusted Gross Income Include the Amounts

question 128

Multiple Choice

On Form 1040,deductions for adjusted gross income include the amounts paid for all of the following except

• A)alimony.
• B)home mortgage interest.
• C)student loan interest.
• D)moving expenses.

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Definitions:

Target Capital Structure

The relative amount of debt, preferred stock, and common equity that the firm desires. The weighted average cost of capital should be based on these target weights.

Cost of Equity

The return a company requires to decide if an investment meets capital return requirements, a crucial part of capital budgeting and often calculated using models like CAPM.

WACC

Weighted Average Cost of Capital; a calculation of a firm's cost of capital in which each category of capital is proportionately weighted. It represents the average rate that a company is expected to pay to finance its assets.

Cost of Debt

The effective rate that a company pays on its borrowed funds from financial institutions and other sources.