Evaluate and explain the cost of capital in doing so please take on the role of an expert in this area and create a PowerPoint Presentation to be given to a group of executives for them to understand what cost of capital means. Formulate and provide conclusions and recommendations for this group. Include in your presentation the following:
- What is the cost of capital and how does it play a role in various decisions made by financial managers?
- What factors determine the cost of capital?
- How to compute cost of debt, preferred and common stock capital and put them together to develop the overall cost of capital for the firm
- What assumptions are made in such computations?
- Role of tax laws in computing cost of capital