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Which statement is incorrect regarding the wacc

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Reference no: EM132842259

Problem 1: If the return on your ordinary share investment is on average 18% and the return on treasury bills was 9% over the same period, what is the risk premium that you earned?

Select one:

a. 9%

b. 18%

c. 11%

d. 27%

Problem 2: Which of the following statement is incorrect regarding the WACC and its components?

Select one:

a. The WACC should be used as the discount rate for all projects that a company considers.

b. The cost of debt is usually less than the cost of equity.

c. For an all-equity company, the cost of equity equals the WACC

d. The WACC may increase if a company seeks external financing for a project.

Reference no: EM132842259

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