For a typical firm with a given capital structure,which of the following is correct? (Note: r_a = WACC,and all rates are after taxes. ) A) r_d r_e r_s r_a. B) r_s r_e r_d r_a. C) r_a r_e r_s r_d. D) r_e r_s r_a r_d. E) None of the statements above is correct.

Question

For a typical firm with a given capital structure,which of the following is correct? (Note: r_a = WACC,and all rates are after taxes. ) A) r_d > r_e > r_s > r_a. B) r_s > r_e > r_d > r_a. C) r_a > r_e > r_s > r_d. D) r_e > r_s > r_a > r_d. E) None of the statements above is correct.

Quizplus · Accepted Answer

The Answer is D

For a Typical Firm with a Given Capital Structure,which of the Following