Which of the following statements is CORRECT?

Question 7 options:

	The WACC is calculated using before-tax costs for all components.
	The after-tax cost of debt usually exceeds the after-tax cost of equity.
	For a given firm, the after-tax cost of debt is always more expensive than the after-tax cost of non-convertible preferred stock.
	The WACC that should be used in capital budgeting is the firm's marginal, after-tax cost of capital.