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Please help I am taking a test now. Need answers asap! Which of the following statements is CORRECT? If a company assigns the same cost

Please help I am taking a test now. Need answers asap! image text in transcribed
Which of the following statements is CORRECT? If a company assigns the same cost of capital to all of its projects regardless of each project's risk, then the company is likely to reject some safe projects that it actually should accept and to accept some risks projects that it should reject. Higher floatation costs tend to reduce the cost of equity capital. Since debt capital can cause a company to go bankrupt but equity capital cannot, debt is riskier than equity, and thus the after-tax cost of debt is always greater than the cost of equity. The tax-adjusted cost of debt is always greater than the interest rate on debt, provided the company does in fact pay taxes

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