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I need to calculate the cost of capital to the firm using the information below. What formula would I use? I actually found this questioned
I need to calculate the cost of capital to the firm using the information below. What formula would I use?
I actually found this questioned was previously answered by a tutor and they provided the following:
Cost of Capital = [(25%*300,000)/1,000,000]*(1+3%)= 7.725%
I want to better understand the formula used and what each component means so that I can learn.
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