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    mikecampana2's Avatar
    mikecampana2 Posts: 2, Reputation: 1
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    #1

    Dec 13, 2010, 10:01 AM
    Perceived risk how they affect the cost of debt?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Dec 18, 2010, 07:32 PM

    The higher the risk the more risky the company is in paying its debts, which means with a high risk you will have to pay a higher finance charge on a loan and an investor will want a higher rate of return on his or her investment. With a low risk an investor will accept a lower rate of return.
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