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T/F: The firm should always consider to use retained earnings first because retained earnings are internal...

T/F: The firm should always consider to use retained earnings first because retained earnings are internal capital of the firm and have no cost to the firm

T/F: The firm should always consider to use retained earnings first because retained earnings are internal capital of the firm and have no cost to the firm

T/F: A project’s NPV is negatively related to the WACC.

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The firm should always consider to use retained earnings first because retained earnings are internal capital of the firm and have no cost to the firm - FALSE
Retained earnings should be used first as the cost of retained earnings is LOWER as no flotation cost is incurred on retained earnings

They belong to shareholders and carries cost as well

A project’s NPV is negatively related to the WACC.

TRUE

higher the WACC, lower will be the present value of cash inflows and hence,lower NPV

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