The marginal cost of capital

Risk analysis may be introduced by

Risk analysis may be introduced by

An increase in investors’ required return decreases an investment’s internal rate of return.​

Long-term assets such as plant spontaneously vary with sales.​

The retention of earnings instead of paying dividends

If interest rates are 9 percent, an annuity of $100 for 10 years is to be preferred to $1,000 after 10 years.​

If two investments are not mutually exclusive, the firm can make only one of them.​

Many bonds have a call feature, which permits the firm to retire the bonds prior to maturity.​

If a person owes $50,000 at 10 percent and annually pays $10,000, the loan will be retired in 5 years.​