What about WACC – will it be higher for a $5 billion or $500 million company?

This is a bit of a trick question because it depends on whether or not the capital structure is the same for both companies. If the capital structure is the same in terms of percentages and interest rates and such, then WACC should be higher for the $500 million company for the same reasons as mentioned above.

If the capital structure is not the same, then it could go either way depending on how much debt/preferred stock each one has and what the interest rates are.