QUESTION 8 The static theory of capital structure provides an equation which affords the exact optimal weights on debt and equity. O True False QUESTION 9 Your company's outstanding bonds have a yield-to-maturity of 10%. The tax rate is 30%. What is your aftertax cost of debt financing? 5% 6% 7% 10% QUESTION 10 Which one of the following risks is irrelevant to a well-diversified investor? market risk firm specific risk QUESTION 11 risk relative to the asset. An asset's beta coefficient measures an asset's firm specific; most risky firm specific; least risky systematic; average systematic; most risky QUESTION 12 0 The discount rate that makes the net present value of an investment exactly equal to zero is called the: external rate of return (ERR). internal rate of return (IRR). average accounting return. profitability index QUESTION 13 The systematic risk principle implies that the expected return on an asset depends only on that asset's: unsystematic risk systematic risk credit risk interest rate risk