The firm's weighted average cost of capital (WACC) is
A) set by the board of directors of the firm because it is the benchmark they use to evaluate upper management.
B) regulated by the Internal Revenue Service (IRS) because tax-deductible debt is included in the computation.
C) determined by the financial markets because investors provide the funds used by firms and these funds have costs, which are the returns demanded by investors.
D) the same as the firm's internal rate of return (IRR) .
E) the total net present value (NPV) of all the capital budgeting projects in which the firm invests in any year.
Correct Answer:
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