If a firm's marginal tax rate is increased this would other things held constant lower the cost of debt used to calculate its WACC True or False?

True. An increase in a firm's marginal tax rate reduces the after-tax cost of debt because interest expenses are tax-deductible. This means that the effective cost of borrowing becomes lower for the firm, which, when calculating the Weighted Average Cost of Capital (WACC), results in a decreased cost of debt, assuming all other factors remain constant.