1: Reject; Accept

2: Greater than; Less than; the same as

Each of the following factors affects the weighted average cost of capital (WACC) equation. Which are factors that a firm cannot control? Check all that apply. The general level of stock prices The firm's capital budgeting decision rules Tax rates O Interest rates in the economy The impact of cost of capital on managerial decisions Anderson Animations Corporation has two divisions, L and H. Division L is the company's low-risk division and would have a weighted average cost of capital of 10% if it was operated as an independent company. Division H is the company's high-risk division and would have a weighted average cost of capital of 16% if it was operated as an independent company. Because the two divisions are the same size, the company has a composite weighted average cost of capital of 13%. Division H is considering a project with an expected return of 14%. Anderson Animations Corporation should the Division H's project because its return is the risk-based cost of capital for the division