COST OF CAPITAL FINANCE MBA PPT.pptx

finance cost of capital in management

1. COST OF EQUITY SHARE CAPITAL Cost of equity capital Isa little difficult as compared to debt capital and preference capital. The main reason is that the equity shareholders do nit receive fixed interest or dividend. The dividend on equity shares varies depending upon the profit earned by an organization. Risk factor also plays an important role in deciding rate of dividend to be paid on equity capital.

2. Dividend Price Approach:

3. PROBLEMS- DISCUSSED ………NOTE BOOK

4. Earnings Price Approach

5. Growth approach or Gordon’s Model:

6. Realized Yield method Approach

7. Problem :

8. CAPM APPROACH