Question 16 3 pts Which is TRUE? When interest rates are low, avoid issuing bonds, instead issue stocks In bull market, stocks are ideal for raising funds To make managers more disciplined and focused, issue stocks for financing Use new issue of common stocks rather than use up retained earnings Question 17 3 pts When corporate tax rate Tc increases, the value of tax shield for debts of a levered firm V O decreases O remains the same increases Question 18 3 pts Among he four choices given to you, Which ONE should you MAXIMIZE? Earnings per share (EPS) Required Return on Equity O Net Income Price of Stock Question 19 3 pts Which risk offers the MOST reward to a firm? Financial risk O Business risk O investment in risk-free assets Question 20 10 pts Flotation Expense = 3.0% Tax rate Price of Bond= $950 = 25.0% Par Value = $1,000 Maturity = 5 years Coupon rate = 6.0% per annum, paid semiannually What is the after-tax cost of debt? Have your calculator display 4 decimal points Make sure that you convert your answer to an annualized rate Enter Answer in Canvas in decimal points, e.g., 0.1075, NOT 10.75 or 10.75% "ID" = (1 - T) X YTM