The cost of equity capital is all of the following EXCEPT :

CS Executive · Financial and Strategic Management · PYQS · June 2024
The cost of equity capital is all of the following EXCEPT :
(A) The minimum rate that a firm should earn on the equity-financed part of an investment
(B) A return on the equity-financed portion of an investment that, at worst, leaves the market price of the stock unchanged
(C) By far the most difficult component cost to estimate
(D) Is generally lower than the after-tax cost of debt

Answer & Explanation:

Correct Answer: Option (D)

Official answer key: (D).

Topics: Financial Management

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