Q401
Cost of capital is equal to required return rate on equity in case if investors are only
A.
valuation manager
B.
common stockholders
AnswerC.
asset seller
D.
equity dealer
Answer: Option B
Solution
Answer: Option B
Solution:
Cost of capital is equal to required return rate on equity in case if investors are only common stockholders. Cost of capital refers to the opportunity cost of making a specific investment. It is the rate of return that could have been earned by putting the same money into a different investment with equal risk.