A firm's weighted marginal cost of capital increases when internal equity financing is exhausted but is unaffected by an increase in the cost of other financing sources.

Name: A firm's weighted marginal cost of capital increases when internal equity financing is exhausted but is unaffected by an increase in the cost of other financing sources.
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Question

Quizplus · Accepted Answer

The weighted marginal cost of capital is affected by changes in the cost of any financing source, including debt and external equity, not just internal equity.

A Firm's Weighted Marginal Cost of Capital Increases When Internal