The computation of which one of the following requires assigning every proposed investment to a particular risk class?

Question

Quizplus · Accepted Answer

The computation of the subjective cost of capital requires assigning every proposed investment to a particular risk class based on the analyst's subjective judgment of the investment's risk level. This cannot be determined by a formula or objective criteria, unlike the pure play cost of capital, cost of equity, aftertax cost of debt, and WACC.

The Computation of Which One of the Following Requires Assigning