Market values are often used in computing the weighted average cost of capital because | Faculties

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Ranjeet

🎓 Tutor III ⭐ 34.60K Points

📊 Financial Management

Q. Market values are often used in computing the weighted average cost of capital because

(A) this is the simplest way to do the calculation.
(B) this is consistent with the goal of maximizing shareholder value.
(C) this is required in the U.S. by the Securities and Exchange Commission.
(D) this is a very common mistake.

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✅ Correct Answer: (B) this is consistent with the goal of maximizing shareholder value.

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