Which of the following is a major assumption that is embedded in the capital asset pricing model (CAPM), which is often used to estimate the cost of retained a. Investors primarily purchase stocks with beta coefficients equal to zero. b. All investors are well diversified The firm's cost of retained eamings must be less than its cost of preferred stock for the CAPM to provide a reasonable estimate for d. The firm's cost of equity and its cost of debt are always equal. The firm's dividends and earnings grow at a cost ich of the following is to the c rate for into the future. h ef prevedeck co w o Fotos coincrease the cost o f the cost of retained angebote for k is greater quity y o to Flotatie cos should be added to the per preferred stock price of a prim e to compute the cost of words from When it incursion, the security in the when there are y flott o t of capital to determine the Flowtation costs should be added to the bo fins overall led average cost of capital where SW Inc.'s preferred stock, which pays a $525 dividend each year, currently sells for 562.50. The company's marginal tax rate is 40 percent. When it is ties preferred stock, SW normally incurs flotation costs equal to 5 percent. What is the cost of preferred stock, Tp that should be included in the computation of the SW Inc.'s weighted average cost of capital (WACC) a 8.40% 7.73% 9.13% d. 9.07% 7.7596 The rates of return, or costs that a firm must pay to raise funds to invest in capital budgeting projects are determined by the a internal rate of return the firm earns on its investments b. marginal revenue generated by projects in which the firm invests. investors who purchase the firm's stocks and bonds in the financial markets. . d. cash flows generated by the investment in capital budgeting projects