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4 Cards in this Set
- Front
- Back
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Cost of equity
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The return that equity investors require on their investment in the firm.
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Cost of debt
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The return that lenders require on the firm's debt.
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Weighted average cost of capital (WACC)
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The weighted average of the cost of equity and the aftertax cost of debt.
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Pure play approach
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The use of a WACC that is unique to a particular project, based on companies in similar lines of business.
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