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Beckham Corporation has bonds outstanding with 13 years to maturity and are currently priced at $746.16. If the bonds have a coupon rate of 8.5 percent, then what is the after-tax cost of debt for Beckham if its marginal tax rate is 35%? Assume that the bonds make semi-annual coupon payments. 08.125% O 12.890% O 12.500% O 6.250% Which of the following statements is most correct? If a project's internal rate of return (IRR) exceeds the cost of capital, then the project's net present value (NPV) must be positive. If Project A has a higher IRR than Project B, then Project A must also have a higher NPV. O The IRR calculation implicitly assumes that all cash flows are reinvested at a rate of return equal to the cost of capital. O Statements a and c are correct. O None of the statements above is correct. Which of the following is not considered a capital component for the purpose of calculating the weighted average cost of capital (WACC) as it applies to capital budgeting? O Preferred stock. O Long-term debt. O Common stock. O Accounts payable and accruals. Which of the following statements is most correct? The WACC measures the after-tax cost of capital. The WACC measures the marginal cost of capital. There is no cost associated with using retained earnings. Statements a and b are correct

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