remaining time: 10 minutes, 25 seconas. Question Completion Status: QUESTION 16 - tax rate) in Why is the company's cost of borrowing reduced for (1 calculating the WACC? Because debt is cheaper than stock Because interest is an expense that reduces the tax liability (saves the company by paying less in tax) To adjust for the riskiness of common equity (stock) Because that is the YTM of the company's bonds x (1 - tax rate) ligi