Question: 2. The capital structure weights used in computing the weighted average cost of capital: A. remain constant over time unless the firm issues new securities.

2. The capital structure weights used in computing the weighted average cost of capital: A. remain constant over time unless the firm issues new securities. B. are based on the book values of total debt and total equity. C. are based on the market values of total debt and total equity. D. are restricted to the firm's debt and common stock only 3. The cost of preferred stock is computed the same as the: A. pre-tax cost of debt. B. return on a perpetuity. C. return on an annuity. D. aftertax cost of debt

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