The cost of capital is a single rate that reflects the average return paid to investors who provide the firm's capital.

Question

Quizplus · Accepted Answer

This statement is true. The cost of capital represents the average cost of financing a firm's assets and is often used to determine the minimum acceptable return that the firm must earn to satisfy its investors. It takes into account both the cost of debt and the cost of equity capital.

The Cost of Capital Is a Single Rate That Reflects