Question: Compared to Clemson Corp. Ole Miss Inc. has both a higher cost of capital for its debt and a higher cost of capital for its
Compared to Clemson Corp. Ole Miss Inc. has both a higher cost of capital for its debt and a higher cost of capital for its equity. Does this necessarily imply that the firm Ole Miss Inc. has a higher overall cost of capital than the firm Clemson Corp.? O A. No, because it will also depend on the relative weights of debt and equity B. Both Clemson Corp. and Ole Miss Inc. will have the same cost of capital OC. Yes, because the average of the debt cost of capital and the equityoot of capital will always be higher for Ole Miss OD. The answer will depend on the macroeconomic conditions prevalling at that time, ght OE The answer will depend on prevalent debt market conditions at that time. MT Insert appropriate prompt, input type, and other instructions here
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