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13) A company's current cost of capital is based on: 13) A) both the returns currently required by its debtholders and stockholders. B) the current

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13) A company's current cost of capital is based on: 13) A) both the returns currently required by its debtholders and stockholders. B) the current market rate of return on equity shares. C) the weighted costs of all future funding sources. D) only the return required by the company's current shareholders. E) the company's original debt-equity ratio. 14) A company's overall cost of equity is: 14) A) unaffected by changes in the market risk premium. B) inversely related to changes in the level of inflation. C) generally less than the firm's aftertax cost of debt. D) generally less than its WACC given a debt-equity ratio of .5. E) directly related to the risk level of the firm

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