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which of the following statements is correct a if a company assigned the same cost of capital to all of its projects regardless of each
which of the following statements is correct a if a company assigned the same cost of capital to all of its projects regardless of each projects risk and the company is likely to reject some of the safe projects that it actually should accept and accept some brisky projects that it should reject be because no flotation costs are required to obtain capital as reinvested earnings. The cost of reinvested earnings is generally lower than the after tax cost of debt, that can cause a company to go bankrupt but equity capital cannot debt is riskier than equity and thus after tax cost of debt is always greater than the cost of equity
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