Which of the following is the formula to calculate cost of capital?*Total assets/Net debt x Cost of debt + Total assets/Equity x Cost of equityNet debt/Equity x Cost of debt + Equity/Net debt x Cost of equityNet debt x Cost of debt + Equity x Cost of equityNet debt/Total assets x Cost of debt + Equity/Total assets x Cost of equity

The cost of capital is the same as the cost of equity for firms that are financed:Group of answer choicesentirely by debt.entirely by equity.by 50 percent equity and 50 percent debt.by both debt and equity.

Explain briefly the various methods of computing cost of equity capital. Which of them do you consider most appropriate and why?

What does the cost of capital represent?Answer areaa) The total expenses incurred by a firmd) The price of borrowing money from financial institutionsb) The rate of return required by investors for providing capital to a companyc) The market value of a company's assets

Cost of Equity5%Cost of debt7%% Debt60% % Equity40%Given the data in the above table, what is the weighted average cost of capital of this company?4.0%3.7%5.9%6.2%

Single choice8)A bank's capital ratio is calculated by which of the following formulas?Risk-weighted assets/bank capitalBank capital/ total assetsBank capital/risk-weighted assets