Cost of Capital Quiz

Interest rate is 12% and tax rate 40%. then after-tax component cost of debt will be ____

• 7.20%

• 7.25 times

• 17.14 times

• 0.1714

The market price of an Equity share is Rs 120. The expected Equity dividend is Rs 2.40 per share. The shareholders anticipate a growth of 10% in dividends. Calculate cost of equity capital.

• 1%

• 12%

• 14%

• 16%

Which of the following has the highest cost of capital?

• Equity shares

• Loans

• Bonds

• Preference

Cost of 15% Preference shares issued at par, assuming tax rate to be 50% will be_____

• 8.40%

• 10%

• 15%

• 15.20%

Which of the following cost of capital require tax adjustment?

• Cost of Equity Shares

• Cost of Preference Shares

• Cost of Debentures

• Cost of Retained Earnings

_________are the last claimant on the profits of the company

• Equity shareholders

• Preference shareholders

• Debentureholders

• Creditors

Kr stands for

• Cost of retained earnings

• Cost of preference capital

• Cost of debts

• Cost of equity capital

The market price per share of Mobile Glycols Limited is Rs 125. The dividend expected per share a year hence is Rs 12 and the DPS is expected to grow at a constant rate of 8 percent per annum. What is the cost of the equity capital to the company?

• 17.6

• 9.6

• 1.6

• 18

What is existing cost of capital for S Ltd?

• 11%

• 8.75%

• 10%

• 12%

in the above question of S Ltd, what will be revised cost of capital ?

• 8.75%

• 11%

• 12%

• 10%