Which of the following best describes what the cost of capital should reflect?
A) The cost of capital should reflect the average cost of the various sources of short-term funds a firm uses to acquire assets.
B) The cost of capital should reflect the average cost of the various sources of long-term bonds a firm uses to acquire fixed assets.
C) The cost of capital should reflect the average cost of the various sources of long-term funds a firm uses to acquire assets.
D) The cost of capital should reflect the average cost of the various sources of long-term capital, as well as supplier capital, the firm uses to acquire fixed assets.
Correct Answer:
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