The wealth-maximizing investment decision for a firm occurs when
A. the cost of capital equals the return on the project.
B. the weighted marginal cost of capital is less than the investment opportunity schedule.
C. the weighted cost of capital exceeds the marginal cost of capital.
D. the weighted marginal cost of capital equals the investment opportunity schedule.
Answer:D
The wealth-maximizing investment decision for a firm occurs when
A. the cost of capital equals the return on the project. B. the weighted marginal cost of capital is less than the investment opportunity schedule. C. the weighted cost of capital exceeds the marginal cost of capital. D. the weighted marginal cost of capital equals the investment opportunity schedule.