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A "Normal" Project refers to a project producing a product or service the firm has experience...

A "Normal" Project refers to a project producing a product or service the firm has experience with because it is related to its current products or services.

A.True B.False

7.A firm's capital structure would be optimized whatever the composition of the capital structure because nearly all capital structure are optimal.

A True B False

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Answer #1

1: True

Normal project is one which is undertaken in the ordinary course of business. It is a project with which the firm has some experience and which has been undertaken earlier also.

2: False

The capital structure is optimum at the point where the cost of capital is least. Due to lower cost of debt this cost changes with the proportion of debt in the capital structure.

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