Investors require a return on their investments on each of a firm's capital components. These required returns are the cost of each component that the company must assume in order to raise capital.

Question

Quizplus · Accepted Answer

This statement accurately describes the concept of cost of capital and required returns on each of a company's capital components. It is important for a company to consider these costs when making investment decisions and determining their overall cost of capital.

Investors Require a Return on Their Investments on Each of a Firm's