Question: Company Issues New Shares And With That Money Pays Back A Bank Loan. Company’s Cost Of Capital (WACC) Should: Select One: A. Decrease, As Company Doesn’t Pay Any Dividends B. Decreases Because The Company Now Pays Less Interest C. Remain Unchanged As The Total Capital Has Not Changed D. Increase Because Equity Is More Expensive As Debt

Question: Company Issues New Shares And With That Money Pays Back A Bank Loan. Company’s Cost Of Capital (WACC) Should: Select One: A. Decrease, As Company Doesn’t Pay Any Dividends B. Decreases Because The Company Now Pays Less Interest C. Remain Unchanged As The Total Capital Has Not Changed D. Increase Because Equity Is More Expensive As Debt

Company issues new shares and with that money pays back a bankloan. Company’s cost of capital (WACC) should:

Select one:

a.

Decrease, as company doesn’t pay any dividends

b.

decreases because the company now pays less interest

c.

Remain unchanged as the total capital has not changed

d.

Increase because equity is more expensive as debt