Cost of capital

By | 2017-09-13T13:24:46+00:00 13th September 2017|

The cost of funds used for financing a business. Cost of capital depends on the mode of financing used – it refers to the cost of equity if the business is financed solely through equity, or to the cost of debt if it is financed solely through debt. The cost of equity can be calculated using the Capital Asset Pricing Model.