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    mohannad's Avatar
    mohannad Posts: 1, Reputation: 1
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    #1

    Mar 13, 2009, 05:10 PM
    Calculating cost of equity capital
    What are the different methods for calculating cost of equity cost of capital ?
    Please give examples.
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #2

    Mar 13, 2009, 10:47 PM

    Definition of Cost of Capital.

    The cost of capital of a firm may be defined as a weighted average of the cost of each type of capital.The weight for each type of capital is the ratio of the market value of the securities
    representing that source of capital to the market value of all securities issued by the company.
    The term security includes common and preferred stocks and all interest-bearing liabilities, including notes payable.
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