Question 5 The optimum capital structure a) Provides the lowest cost of capital b) Has the best mix of debt, preferred stock, and common equity Oc) Can change over time as market and firm conditions change d) All of these apply Question 6 In calculating the cost of common equity using K = (D /P.) + 9. g is the a) Price of the stock today b) Dividend at the end of the first year (or period) c) Required rate of return d) Constant growth rate in dividends Question 7 In considering whether a project provides a sufficient return, the company should measure the project's return against the company's a) Weighted average cost of capital b) Return required by shareholders c) Return required by bondholders