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In capital budgeting cost of capital is used as discount rate...

This question belongs to Commerce Financial Management
Financial Management
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In capital budgeting, cost of capital is used as discount rate and is based on pre-determines

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Correct Answer: Option B
In capital budgeting, cost of capital is used as discount rate and is based on pre-determines cost of debt and equity. Cost of debt refers to the effective rate a company pays on its current debt. The cost of equity is the return a company requires to decide if an investment meets capital return requirements.
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