Finance

The cost of capital is the cost of a company’s funds (both debt and equity). In words of Solomon Erza “The cost of capital is the minimum required rate of earnings or the cut-off rate of expenditure”. From Investor’s point of view, it is the rate of return, that must be received by the firm on its investment projects, to attract …

Cost of Capital: Concept, Types Read More »

For optimal financial decisions, it is essential to define objectives of financial management. These objectives serve as decision-criterion. Financing is a functional area of business and, therefore, the objectives of financial management must be in tune with the overall objectives of the business. The main objectives of business are survival and growth. In order to …

Profit Maximisation VS Wealth Maximisation Read More »