During the 1980s, the cost of capital for U.S.firms averaged about 3.3 percentage points higher than Japanese firms.During 1990 this disadvantage may have disappeared due to:

Question

Quizplus · Accepted Answer

Higher real interest rates in Japan would make it more expensive for Japanese firms to borrow money, thus leveling the playing field with U.S. firms in terms of cost of capital. The other choices do not directly impact the cost of capital comparison between the two countries.

During the 1980s, the Cost of Capital for U