Why do firms calculate their weighted average cost of capital?

$5.00

a.Why do firms calculate their weighted average cost of capital?

b.In computing the cost of capital, which sources should be considered?

c.How does a firm’s tax rate affect its cost of capital?  What is the effect of the flotation costs associated with a new security issue on a firm’s weighted average cost of capital?

d.Can Grammy’s Legacy engage in capital budgeting and honor God?  Integrate one verse or short-passage of scripture into your answer.