which is lower for a given company the cost, Financial Management

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which is lower for a given company the cost

Which is lower for a given company: the cost of debt or the cost of equity? Explain: Ignore taxes in your answer.

The cost of debt is all the time less as compared to the cost of equity for a given firm. This is since the debt investor is taking a lower risk than the equity investor and hence the required rate of return is lower.

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