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2 A company's capital structure consists of common stock and debt. Which of the following events will increase the company's WACC and why? Note: There
2 | A company's capital structure consists of common stock and debt. Which of the following events will increase the company's WACC and why? Note: There can be more than one correct answer. | ||||||||||
a. | An increase in the market risk premium. | ||||||||||
b. | An increase in the tax rate. | ||||||||||
c. | A decrease in the risk-free rate. | ||||||||||
d. | An increase in expected inflation. | ||||||||||
e. | A reduction in the companys beta. | ||||||||||
f. | Sales revenues increase. | ||||||||||
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