Which of the following factors is not expected to generally have a favorable impact on the firm's cost of capital according to the text?
A) easy access to international capital markets.
B) high degree of international diversification.
C) high exposure to exchange rate fluctuations.
D) all of the above

Question

Quizplus · Accepted Answer

A, B, and D are all expected to generally have a favorable impact on the firm's cost of capital. Easy access to international capital markets can provide the firm with more options for financing at potentially lower costs. High degree of international diversification may reduce the overall risk of the firm, which can lead to a lower cost of capital. However, high exposure to exchange rate fluctuations can increase the risk of the firm and potentially increase the cost of capital.

Which of the Following Factors Is Not Expected to Generally