This company has re=14% rd=8% D/V=.5

E/V= .5 and corporate tax rate of 25%

why is the WACC not neccessarily equal to 10%?

A) Current WAC may not apply to investments in new industry

B) corporate tax rate is not applicable

C) WACC calculation should be 11% not 10%

D) current expexted return for equity does not reflext the risk