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Which of the following statements about the cost of capital is CORRECT?a. A change in a company's target capital structure cannot affect its WACC.b. Flotation costs associated with issuing new common stock normally lead to a decrease in the WACC.c. If a company's tax rate increases, then, all else equal, its weighted average cost of capital will decrease.d. WACC calculations should be based on the before-tax costs of all the individual capital components.e. An increase in the risk-free rate will normally lower the marginal costs of both debt and equity financing.
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