Which of the following statements about the cost of capital is correct?

Select one:

a.WACC should be calculated based on the book value instead of the market value.

b.WACC should be calculated based on the historical costs instead of the marginal costs.

c.Weighted average cost of capital calculations should be focused on the before-tax costs.

d.The reason we must assign a cost of capital to retained earnings involves the opportunity cost principle.

e.A company's target capital structure does not affect its weighted average cost of capital.