How something will affect a firm's cost of capital

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Apr 29, 2008, 05:44 PM

valval73

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How something will affect a firm's cost of capital

In terms of the 3 elements of a firms cost of capital, If an investor becomes more risk averse, how will that affect its cost of debt, its cost of equity, and its WACC? I'm trying to figure out if it would increase, decrease, or have no effect on each of these.

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