1. Which one of the following factors is not considered in calculating the firms cost of equity?

1. risk free rate of return
2. beta
3. interest rate on corporate debt
4. expected return on equities
5. difference between expected return on stocks and the risk free rate of return

2. Which one of the following factors is not considered in calculating the firms cost of capital?

1. cost of equity
2. interest rate on debt
3. the firms marginal tax rate
4. book value of debt and equity
5. the firms target debt to equity ratio

3. A firms leveraged beta reflects all of the following except for

1. unleveraged beta
2. the firms debt
3. marginal tax rate
4. the firms cost of equity
5. the firms equity