Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter5: Buying The Necessities
Section: Chapter Questions
Problem 18AA
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Question
What are the factors that influence a company’s cost of
capital?
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Cost of capital- It is the cost of the funds of a company or, from the point of view of an investor, the necessary rate of return on the outstanding shares of a portfolio company. It is used to assess a firm's new projects. It is the minimum return required by investors to supply the business with money, thereby setting a benchmark that a new assignment needs to follow.
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