The average of a firm's cost of equity and after tax cost of debt that is weighted based on the firm's capital structure is called the:
A: reward to risk ratio
B: weighted capital gains rate
C: structured cost of capital
D: weighted average cost of capital
A: reward to risk ratio
B: weighted capital gains rate
C: structured cost of capital
D: weighted average cost of capital
举一反三
- The value of a firm is maximized when the A: cost of equity is maximized. B: tax rate is zero. C: levered cost of capital is maximized. D: weighted average cost of capital is minimized.
- Which one of the following terms is defined as the mixture of a firm's debt and equity financing? A: cash management B: cost analysis C: capital structure D: working capital management
- Cost of capital isthe company’s cost of capital multiplied by the amount of the investment.
- Company A’s capital employed and its adjusted profit is $800m and $500m respectively. Its target capital structure is 75% equity 25% debt. The cost of equity is 18% and pre-tax cost of debt is 12%. What is the value of EVA using Economic Value Added approach?
- A capital investment’s internal rate of return( ). A: Must exceed the cost of capital in order for the firm to accept the investment. B: C: Statements c and d are correct. D: Changes when the cost of capital changes. E: Is similar to the yield to maturity on a bon F: Is equal to the annual net cash flows divided by one half of the project’s cost when the cash flows are an annuity.