Which of the following statements regarding the cost of capital and its effect on capital structure and investment choices is correct? A. For an investment to be worthwhile, the expected return must be greater than the cost of capital.
Which of the following statements regarding the cost of capital
and its effect on capital structure and investment choices is correct?
A. For an investment to be worthwhile, the expected return must be greater than the cost of capital.
B. Because of tax advantages, it is cheaper to issue new equity than debt.
C. Adding debt does not increase a company’s interest rate.
D. All of these answers.
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