Chapter 15: Outline The Cost of Capital: Some Preliminaries The Cost of Equity The Costs of Debt and Preferred Stock The Weighted Average Cost of Capital Divisional and Project…

Cost of Capital Cost of Capital Why Cost of Capital Is Important We know that the return earned on assets depends on the risk of those assets The return to an investor is…

Financial Management FIN300 Leverage and Capital Structure Objectives Upon completion of this lesson, you will be able to: Discuss the effect of financial leverage Analyze…

Chapter 14 Cost of Capital McGraw-Hill/Irwin Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved. Key Concepts and Skills Know how to determine a firm’s…

PowerPoint Presentation Cost of capital Chapter 7 12.0 Chapter Outline The Cost of Capital: Introduction The Cost of Equity (CAPM and DDM) The Costs of Debt and Preferred…

PowerPoint Presentation Cost of capital and long-term financial policy Chapter 14 12.0 Chapter Outline The Cost of Capital: Introduction The Cost of Equity The Costs of Debt…

Key Concepts and Skills Know how to determine a firm’s cost of equity capital Know how to determine a firm’s cost of debt Know how to determine a firm’s overall cost…

Key Concepts and Skills Know how to determine a firm’s cost of equity capital Know how to determine a firm’s cost of debt Know how to determine a firm’s overall cost…

COST OF CAPITAL AND Chapter 11 The Dividend Growth Model Approach Can be rearranged to solve for RE * Example Suppose that a company just paid a dividend of $2.50 per share.…

Cost of Capital and Efficient Capital Markets Why Cost of Capital Is Important Cost of capital provides us with an indication of how the market views the risk of our assets…