1. The cost of debt is generally lower than the cost of equity.

A.True

B.False

2. Which of the following are sources of founds in a statement of sources and uses?

I. Collection of account receivables

II. Reduction of long-term debt

III. Payment of dividends

IV. Reduction in the cash account

A.I only

B.II and III

C.III and IV

D.I and IV

3.A project with an internal rate of return greater than the cost of capital should always be accept.

A.True

B.False