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Author Question: Which of the following statements is correct? (Read 632 times)

jmoore1989

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on: Aug 7, 2023
Which of the following statements is correct?

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A firm can use retained earnings without paying a flotation cost. Therefore, while the cost of retained earnings is not zero, its cost is generally lower than the after-tax cost of debt.


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If a firm finds that the cost of debt is less than the cost of equity, decreasing its debt ratio must increase its WACC. 


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The capital structure that minimizes the firm’s weighted average cost of capital is also the capital structure that maximizes its EBIT.


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The capital structure that minimizes a firm’s weighted average cost of capital is also the capital structure that maximizes its stock price.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by jmoore1989 on Aug 7, 2023

3ginamay

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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jmoore1989

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Reply 2 on: Aug 7, 2023
YES! Correct, THANKS for helping me on my review

abro1885

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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