The capital structure weights used in computing the weighted average cost of capital are:
A) Constant over time provided that the debt-equity ratio changes in unison with the market values.
B) Based on the face value of the firm's debt.
C) Computed using the book value of the long-term debt and the shareholder's equity.
D) Based on the market value of the firm's debt and equity securities.
E) Limited to the firm's debt and common stock.
Correct Answer:
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