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