In your own words, define each of the following terms:

1. Weighted average cost of capital, WACC; after-tax cost of debt, r_d(1 - T); after-tax cost of short-term deb, r_std(1 - T)
2. Cost of preferred stock, r_ps; cost of common equity, r_s.
3. Target capital structure
4. Flotation cost, F; cost of new external common equity, r_e
5. How can the WACC be both an average cost and a marginal cost?
6. Distinguish between beta (i.e., market) risk, within-firm (i.e., corporate) risk, and stand-alone risk for a potential project. Of these three measures, which is teoretically the most relevant? Why?