Cost of equity: Difference between revisions
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(Ke). | (Ke). | ||
The rate of return on a company’s net investments financed by equity which is required to service the providers of the company’s equity capital. | The rate of return on a company’s net investments financed by equity, which is required to service the providers of the company’s equity capital. | ||
For example 10%. | For example 10%. | ||
The cost of equity is often quantified in practice by using either the Capital asset pricing model, or the Dividend growth model. | The cost of equity is often quantified in practice by using either: (1) the Capital asset pricing model, or (2) the Dividend growth model. | ||
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[[Category:Corporate_finance]] | [[Category:Corporate_finance]] | ||
Revision as of 19:35, 27 November 2014
(Ke).
The rate of return on a company’s net investments financed by equity, which is required to service the providers of the company’s equity capital.
For example 10%.
The cost of equity is often quantified in practice by using either: (1) the Capital asset pricing model, or (2) the Dividend growth model.
