ANSWER TRUE IF THE STATEMENT IS CORRECT AND FALSE IF INCORRECT. Ch 9 Cost of Capital 1. Using a firm's overall cost of capital to evaluate a project's cash flows is problematic in that the firm is a collection of projects, with the possibility that each project has a different level of risk than the other projects currently working for the firm. 2. The finance balance sheet is based on market values, just like the accounting balance sheet. The market value of a firm's assets must always equal the market value of the firm's liabilities plus market value of shareholders' equity. 3. Financial analysts use their knowledge of the finance balance sheet, along with the concept of market efficiency, to estimate the cost of capital for the firm. 4. The total assets of a firm equal $5,000,000, and the firm has $500,000 in debt. The cost of debt is 8% and, the cost of equity is 12 %. The WACC is 11.6 %. 5. Ch 17 International Financial Management 6. According to Exhibit 21.1, the top-ranked multinational company from the U.S.A. was Walmart Stores. goal for firms in the U.S., U.K