Question: 6. Which statement is FALSE? a. Using the bond yield plus risk premium approach, one would add a larger risk premium to Harley Davidson's bond

6. Which statement is FALSE? a. Using the bond yield plus risk premium approach, one would add a larger risk premium to Harley Davidson's bond yield than they would to King Sooper's bond yield. b. WACC is the correct discount rate to use for all capital budgeting projects. The cost of debt should be calculated after tax; that does not apply to the cost of preferred stock or the cost of common stock d. Oftentimes the BV of debt is used to proxy for the MV of debt. e. The MV of equity is equal to the stock price multiplied by the number of shares outstanding. C

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