Which of the following statements is most correct? 1) If a company's tax rate increases but the yield to maturity of its noncallable bonds remains the same, the company's after-tax cost of debt capital used to calculate its weighted average cost of capital will rise. 2) All else equal, an increase in a company's stock price will increase the cost of common stock, rs. 3) All else equal, an increase in the risk-free interest rate will decrease the cost of common stock, r5. Assume the market risk premium remains the same. 4) Answers 1) and 2) are correct. 5) None of the statements above is correct. Which of the following statements is most correct? 1) The WACC is a measure of the before-tax cost of capital. 2) Typically the after-tax cost of debt financing exceeds the cost of equity financing. 3) The WACC measures the after-tax cost of capital. 4) Statements 1) and 2) are correct. 5) Statements 2) and 3) are correct. Which of the following statements is most correct? 1) In the weighted average cost of capital calculation, the firm that issues preferred stock must adjust the cost of preferred stock for the tax exclusion of 70 percent of dividend income. 2) We ideally would like to use historical measures of the component costs from prior financings in estimating the appropriate weighted average cost of capital. 3) The cost of common stock (r5) will increase in the market risk premium and risk-free rate increase by a substantial amount. 4) Statements 1) and 2) are correct. 5) None of the statements above is correct