debt is 6 percent , while its cost of equity is 10 percent . If the appropriate weighted average tax rate is 28 percent , what will be Model Nails ’ WACC ? 7.73 percent 8.40 percent 8.00 percent 16.00 percent We commonly measure the risk-return relationship using which of the following ? Coefficient of variation Standard deviation Expected returns Correlation coefficient Financial plans include which of the following ? Schedule of Sales , Expenses , and Capital Expenditure All of the above Short Term and Long Term Plan Pro forma Income Statement , Balance Sheet Which of the following terms means that during periods when interest rates change substantially , bondholders experience distinct gains and losses in their bond investments ? Interest rate risk Credit quality risk Reinvestment rate risk Liquidity rate risk What are reasons for the firm to go abroad ? Access to raw materials Diversification Lower production cost All of the above Which of these statements is true regarding divisional WACC ? Using a simple firmwide WACC to evaluate new projects would give an unfair advantage to projects that present more risk than the firm ’ s average beta . Using a divisional WACC versus a WACC for the firm ’ s current operations will result in quite a few incorrect decisions .