Which of the following statements is correct? All the answers are correct. When estimating the cost of debt capital for a firm, we are primarily interested in the cost of long-term debt. The difference between the expected return on the market and the risk-free rate is known as the beta. Market value of assets is equal to the book value of liabilities plus the book value of equity. The after-tax cost of equity (common or preferred) have to be adjusted by the marginal income tax rate for the firm