1. IF A CFO tries to weigh capital comp. of preferred stock, common, stock, and debt in accordance with desire to find an improved weighted avg. cost of capital and then finally find an improved stock price;

This attempt represents movement of:

A. Least Cost Capital Structure

B. Maximum Funding

C. Least Cost Asset Structure

D. Target Capital Structure

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Capital Budgeting represnts approach to determine correct decision in choosing between costly products

Correct decision hopefully:

A. Increases value of firm

B. Decreases firm's WACC

C. Minimize value of Firm

D. Increase Firm's WACC

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The highest risk in overall analysis to determine correct answer that will ultimately increase value of the firm involves:

A. questions about validity/certainty of cash flows used in the analysis

B. questions about which analysis tool provides most reliable conclusions.

C. questions about the required rate of return to be used in the NPV analysis

D. questions about the Initial Investment Outlay.