The Weighted Average Cost of Capital for a Firm

The weighted average cost of capital for a firm

A) will increase as the firm increases its use of debt financing because the increased use of debt increases the firm's risk.
B) will decrease as the firm increases its use of debt financing because the cost of debt is lower than the cost of equity financing.
C) may increase or decrease, depending on the relative costs of debt and equity.
D) will remain the same when the firm increases its use of debt financing because the overall risk of the firm stays the same.