Question

Which statement is correct, all else held constant? A. Beta is used to compute the return on equity and the standard deviation is used to compute the return on preferred. B. If you have both the dividend growth and the security market line's costs of equity, you should use the higher of the two estimates when computing WACC. C. The aftertax cost of debt increases when the market price of a bond increases. D. WACC is applicable only to firms that issue both common and preferred stock. E. A decrease in a firm's WACC will increase the attractiveness of the firm's investment options

Answer 1

Answer:

A decrease in a firm's WACC will increase the attractiveness of the firm's investment options.

Explanation:

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