TITLE:
Cost of Capital: Literatures Review about Calculation Methods and Influencing Factors
AUTHORS:
Huihui Li
KEYWORDS:
Cost of Capital, Influencing Factors, Literatures Review
JOURNAL NAME:
Journal of Service Science and Management,
Vol.12 No.3,
April
11,
2019
ABSTRACT: As one of the core concepts of corporate financial management, on the one hand, cost of capital is the cost of corporate financing and related to the financing behavior of firms, on the other hand, cost of capital is the necessary rate of return for investors, which decides investment activities. How to calculate cost of capital? What are the influencing factors for cost of capital? These two questions will play a fundamental role in judging whether cost of capital is high in China and promoting the cost reduction task proposed by the current supply-side reform.