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The optimal capital structure is the mix of debt, equity, and preferred stock that minimizes the company’s cost of preferred stockQUESTION:5[QUESTION BANK ID:269424]TYPE:MULTIPLE CHOICECORRECTWhich of the following statements is correct? << HIDE ANSWERSA
QUESTION:6[QUESTION BANK ID:269602]TYPE:MULTIPLE CHOICECORRECTCurrently, Powell Products has a beta of 1.0, and its sales and profits are positively correlated with the overall economy. The company estimates that a proposed new project would have a higher standard deviation and coefficient of variation than an average company project. Also, the new project’s sales would be countercyclical in the sense that they would be high when the overall economy is down and low when the overall economy is strong. On the basis of this information, which of the following statements is correct? << HIDE ANSWERS
QUESTION:7[QUESTION BANK ID:269437]TYPE:MULTIPLE CHOICECORRECTWhich of the following should not influence a firm’s dividend policy decision? << HIDE ANSWERS