RAROC is a measure of a firm's cost of debt.

Name: RAROC is a measure of a firm's cost of debt.
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RAROC (Risk-Adjusted Return on Capital) is a measure of the profitability of a firm's investment, taking into account the level of risk involved. It compares the expected return on an investment to the economic capital required to support the investment. It is not a measure of a firm's cost of debt, but rather a measure of the return on investment adjusted for risk.

RAROC Is a Measure of a Firm's Cost of Debt