Open Educational Resources

Document Type

Lecture or Presentation

Publication Date

Spring 4-15-2022


Cost of Capital

  • Compute the component cost of capital for (a) debt, (b) preferred stock, (c) retained earnings, and (d) new common equity.
  • Describe the weighted average cost of capital (WACC) and how it is used to make investment decisions.

Creative Commons License

Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 4.0 License.



To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.