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  3. the effective cost of debt is reduced because a. i

The effective cost of debt is reduced because a. interest is not a tax deducible...

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Accounting

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The effective cost of debt is reduced because a. interest is not a tax deducible expense. b. interest is paid after common stock dividends. c. interest is a tax-deductible expense. d. interest is paid before preferred dividends. Debt financing is more risky for firms thn preferred stock financing because a. preferred stock must be retired. b. interest payments are legal obligations. c. debt need not be refinanced. d. preferred dividend payments are legal obligations. The internal rate of return will be higher if a. the cost of the investment is lower. O b. the cost of the investment is higher. O c. the cost of capital is lower. d. the cost of capital is higher. The net present value will be larger if a. there is no salvage value. b. the cost of capital is higher. c. the firm uses straight-line depreciation. Od the cost of the investment is lower

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