Which one of the following statements is correct concerning capital structure weights?
A) Target rates are less relevant to a project than are historical rates.
B) The weights are unaffected when a bond issue matures.
C) An increase in the debt-equity ratio will increase the weight of the common stock.
D) The repurchase of preferred stock will increase the weight of debt.
E) The issuance of additional shares of common stock will increase the weight of the preferred stock.
Correct Answer:
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