Finance Ch.11

For many firms the cheapest and most important source of equity capital is in the form of Retained earnings
Each project should be judged against Weighted average cost of capital
National capital does not include Working capital
If a firm’s balls are currently only 6% in the marketplace why would the firm’s cost of that be lower Interest is tax-deductible
Other debt financing is usually the cheapest component of capital it cannot be used in excess because The financial risk of the fermi increase in those drive up the cost of all sources of financing
The pretax cost of debt for a new issue of that is determined by Do you up to maturity of outstanding bonds
The cost of equity capital in the form of new common stock will be higher than the cost of retained earnings because The existence of rotation cost
The after-tax cost of preferred stock to the issuing corporation Is the same as the before tax cost
Why is the cost of debt normally lower than the cost of preferred stock Interest is tax-deductible
A firms debt to equity ratio varies at times because All of these are accurate statement
Retained earnings has a cost associated with it because There is an opportunity cost associated with stockholder funds
There may be a change in the marginal cost of capital curb because Attacks has exhausted supply retainers

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