When determining a firm's weighted average cost of capital (WACC), which of the following terms is NOT necessary?
A) the firm's tax rate
B) the firm's cost of debt
C) the firm's cost of equity
D) All of the above are necessary.

Question

Quizplus · Accepted Answer

All of the above terms are necessary in determining a firm's weighted average cost of capital (WACC). The WACC formula includes the cost of debt, cost of equity, and the tax rate.

When Determining a Firm's Weighted Average Cost of Capital (WACC)