g Which of the following statements is CORRECT? a. Since the money is readily available, the after-tax cost of reinvested earnings (not newly issued stock) is usually much lower than the after-tax cost of debt. b. If a company's tax rate increases but the YTM on its noncallable bonds remains the same, the after-tax cost of its debt will fall. c. All else equal, an increase in a company's stock price will increase its marginal cost of new common equity, re. d. All else equal, an increase in a company's stock price will increase its marginal cost of reinvested earnings (not newly issued stock), rs.

Which of the following statements is correct? a. the managers of established, stable companies sometimes attempt to get their state legislatures to remove rules that make it more difficult for raiders to succeed with hostile takeovers. b. hostile takeovers are most likely to occur when a firm's stock is selling below its intrinsic value as a result of poor management. c. stockholders in general would be better off if managers never disclosed favorable events and therefore caused the price of the firm's stock to sell at a price below its intrinsic value. d. the efficiency of the u.s. economy would probably be increased if hostile takeovers were absolutely forbidden. e. in general, it is more in bondholders' interests than stockholders' interests for a firm to shift its investment focus away from safe, stable investments and into risky investments, especially those that primarily involve research and development. icon key question 6 of 10 b multiple choice 01-060