Q1: The main benefit of using debt in the capital structure is the

Select one:

a,Higher underwriting cost of debt

b,Cost of insolvency of debt

c,Interest tax shield of debt

d,Tax deductibility of dividend payments

Q2: We can use the weighted average cost of capital (WACC) as a discount rate in net present value (NPV) calculations if the project

Select one:

a, Is expected to generate a negative return

b, Has more risk than the company as a whole

c, Has the same risk as the company as a whole

d, Is small in value relative to the company as a whole

Q3: Free cash flow (FCF) is cash flow

Select one:

a, That has already been paid for all sunk costs associated with a project

b, After paying for tax

c, After subtracting all necessary investments to maintain capital

d, That is only earned if a project is undertaken