Cost of Capital, Bond Ratings, and Capital Budgeting
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Explain the cost of capital, and how it affects bond ratings, and the capital budgeting decision-making process. Can any parts of this be utilized at home?
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The bond rating has considerable impact on the interest rate paid by a corporation. Bond rating indicates the credibility and the paying capacity of the organization. Thus if the organization has higher rating then the interest rate paid by it will be less. This is because higher rating indicates more safety. Thus more safety means ...
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