Aol finance test - Study guides, Class notes & Summaries

WACC (weighted average cost of capital) - correct answerA weighted average of the component costs of debt, preferred stock, and common equity. CAPM (Capital Asset Pricing Model) Formula - correct answerKcs = Rrf + B(Rm-Rrf) where Rrf = risk free rate, B = beta, Rm = return on the market, Rm-Rrf = risk premium CAPM (Capital Asset Pricing Model) - correct answera model based on the proposition that any stock's required rate of return is equal to the risk-free rate of return plus a risk prem...

WACC (weighted average cost of capital) correct answersA weighted average of the component costs of debt, preferred stock, and common equity. CAPM (Capital Asset Pricing Model) Formula correct answersKcs = Rrf + B(Rm-Rrf) where Rrf = risk free rate, B = beta, Rm = return on the market, Rm-Rrf = risk premium CAPM (Capital Asset Pricing Model) correct answersa model based on the proposition that any stock's required rate of return is equal to the risk-free rate of return plus a risk premium...