The author describes three interpretations of the cost of capital; one as a value driver, one from the investor's view point, and one from the viewpoint of the entrepreneur
Explain these three different interpretations, provide an example of each, and confirm why each is an appropriate interpretation of the cost of capital.
The cost of capital can be thought of as the price a firm pays to obtain funds to undertake investment opportunities. Thinking of the cost as a value driver, the firm must invest in projects that exceed the cost of capital. I.e., if I obtain funds for 8%, I must earn in excess of 8% to grow the firm.
A second interpretation is that the cost of capital is the average cost of financing the various investments or projects facing the firm.
A third interpretation is that the cost of capital is the average cost of financing the various investments or projects facing the firm.
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A. 100 B. 1,356 C. 3,478 D. 4,320
Use this information to answer the following question. Oct. 1 Inventory 200 units @ $12.00 6 Purchase 300 units @ $13.20 13 Purchase 100 units @ $14.40 20 Purchase 200 units @ $15.60 25 Purchase 40 units @ $16.80 Total sales 620 units A periodic inventory system is used. Using LIFO, the cost assigned to ending inventory is
A) $3,480. B) $8,112. C) $2,664. D) $8,928.
The first step of the minimal spanning tree solution to compute the distance of any path through the network
Indicate whether this statement is true or false.
Businesses do not usually pay taxes on the personal property they own, use, or lease, including office or farm equipment and supplies.?
Indicate whether the statement is true or false