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The overall (weighted average) cost of capital is composed of a weighted average of _.

<p><span>a) the cost of common equity and the cost of debt</span></p> <p>b) t<span>he cost of common equity and the cost of preferred stock</span>c) <span>the cost of preferred stock and the cost of debt</span></p> <p>d) <span>the cost of common equity, the cost of preferred stock, and the cost of debt</span></p>

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Question added by Kamran Anjum , Head of Internal Audit , Rafhan Maize Products Company limited, Faisalabad, Pakistan, Ingredion Incorporated Gmbh
Date Posted: 2014/09/22
Ahmed Abdi Mahad
by Ahmed Abdi Mahad , Director of Internal Auditing Directorate , Jigjiga University

The overall cost of capital of a weighted average is composed of the cost of common equity, the cost of preferred stock and the cost of debt.

So, choice D, is the right answer

VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

d) the cost of common equity, the cost of preferred stock, and the cost of debt

Waqar Yusuf Panvelkar
by Waqar Yusuf Panvelkar , CFO , Schlumberger Group Co

Overall Csot of Capital include Cost of Equity ( notional rate of Interest for Govt Bonds to be assumed for Cost of Equity as mostly Share holder equity is interest free) & Cost of Debt

Mohamed Adel
by Mohamed Adel , Group Financial Manager , Alahly Sabbour real-estate Developments

D) is correct WACC =  (Ke*equity+Kp*preference +Kd(1-t)*Debt) / (O.S+P.S+D)

georgei assi
by georgei assi , مدير حسابات , المجموعة السورية

Answer D correct answer

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