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Which of the following factors, considered in isolation, would reasonably be assumed to contribute to a firm's Weighted Average Cost of Capital (W.A.C.C.) being higher
Which of the following factors, considered in isolation, would reasonably be assumed to contribute to a firm's Weighted Average Cost of Capital (W.A.C.C.) being higher than it otherwise would be? (Choose all that apply.)
a worsening credit rating on its debt |
a lower Beta on its stock |
increasing flotation costs |
increased use of debt in the capital structure (from low to moderate levels), relative to other sources of funding |
increased use of common stock in the capital structure, relative to other sources of funding |
higher interest rates in the overall economy |
an increasing MRP estimate |
a shift in project selection to less risky projects overall |
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