Question: For a typical firm with a given capital structure, which of the following is most correct? (Note: All rates are after taxes; rs=cost of common

For a typical firm with a given capital structure, which of the following is most correct? (Note: All rates are after taxes; rs=cost of common equity; rd=aftertaxcost of debt; WACC = weighted average cost of capital) 1) rd>rs> WACC 2) rs>rd> WACC 3) WACC >rs>rd 4) rs=WACC=rd 5) None of the statements above is correct

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