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Which of the following statements about the cost of capital is INCORRECT? Select one: a. Both the cost of debt and equity financing will increase

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Which of the following statements about the cost of capital is INCORRECT? Select one: a. Both the cost of debt and equity financing will increase when a firm increases its debt/asset ratio. b. Both the cost of debt and equity financing will increase when a firm expands into a risky new area. c. Both the cost of debt and equity financing will increase when the Federal Reserve tightens credit. d. Both the cost of debt and equity financing will increase when a nuclear plant company encounters a ban on nuclear power generation in certain states. O e. The WACC of a firm will decrease when investors become more risk averse

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