The ________ reflects the minimum return investors (and lenders)require,and it is a key driver of the overall value of a firm.

Question

Quizplus · Accepted Answer

The cost of capital reflects the minimum return investors (including both equity investors and lenders) require in order to invest in a company. It is a key driver of the overall value of a firm because it represents the hurdle rate that the company must surpass in order to generate value for its investors. The cost of capital is also used to determine the appropriate discount rate to use when analyzing potential projects and investments.

The ________ Reflects the Minimum Return Investors (And Lenders)require,and It