True or false 1. Internal financing can be limitless with the limitless nature of accumulating earnings 2. Corporations may retain earnings for business expansion and as a requirement of some external financing. 11 3. Corporations may retain earnings to cover losses from purchasing power. 4. Dividend policies may be used to manage the rising cost of capital issuance. 5. While isolated computation of cost of capital can be done, the computation of WACC can provide a better picture because financing is practically drawn from various sources. 6. Maximizing stock price through calculation of optimal capital structure can be achieved with confidence. *