The Cost of Capital is one of our last topics in finance. The Cost of Capital refers to the cost of raising funds to purchase or build or to borrow. Why do you think this is so important? To look at the cost of capital a different way, if you could obtain a cash advance from a credit card for only a 4% annual interest cost, would you consider investing that money? If you did, what type of return would you require? What type of risk would you be willing to assume?