How default risk influence weighted average cost of capital, Business Management

How default risk influence weighted average cost of capital

Companies look for the lowest average rate of financing costs to capitalize business. Common sources of financing are as follows:

- Common stock equity
- Preferred stock equity
- Bond debt

Describe how following risks may influence these three sources of financing and influence overall on weighted average cost of capital (WACC):

- Default risk
- Inflation
- Interest rate risk
- Stock and market volatility

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Business Management: How default risk influence weighted average cost of capital

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Business Management: How default risk influence weighted average cost of capital

Reference No:- TGS034923

Have a Question? (oR Write a Review)

Recent Questions Asked Business Management

Q : Distinguish pecking order theory and trade off theory

Q : Approving loans regardless of background

Q : Relationship of mind and body

Q : Determining ideal ways of life

Q : How default risk influence weighted average cost of capital

Q : Recognizing uncritical thinking

Q : Explain theories of motivation to influence job satisfaction

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Ask an Expert for Answer!!

Business Management: How default risk influence weighted average cost of capital

Reference No:- TGS034923

Recent Questions Asked Business Management

Q : Distinguish pecking order theory and trade off theory

Q : Approving loans regardless of background

Q : Relationship of mind and body

Q : Determining ideal ways of life

Q : How default risk influence weighted average cost of capital

Q : Recognizing uncritical thinking

Q : Explain theories of motivation to influence job satisfaction

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Q : Categorical imperative

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