The cost of new common stock is greater than the cost of retained earnings because

	a) of the flotation costs
	b) it increases the market price of the stock
	c) it decreases the earnings per share
	d) dividends are increased

The certainty equivalent factors used in capital budgeting analysis are equal to the ____ divided by ____.

	a) risky return; certain return
	b) certain return; beta
	c) certain return; risky return
	d) beta, risky return