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Explain the Implicit cost of capital
Implicit cost of capital can be defined as the rate of return associated with the best investment opportunity for the firm and its Shareholders which will be foregone if project presently under consideration by the firm were accepted. In this connection it can be mentioned that explicit costs arise when firm raises funds for financing the project. It's in this sense that retained earnings has implicit cost. Other forms of capital also have implicit costs once they are invested, so in a sense, explicit costs can also be viewed as opportunity costs. This implies that a project must be rejected if it has a negative present value when its cash flows are discounted by the explicit cost of capital.
What is the decision rule for accepting or rejecting proposed projects when using net present value? When going with the net present value decision rule any project with a net
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I need to get a good understandin about what this means?
#discuss the applicability of an operating cycle in vegetable growing business in uganda..
The Managing Director of your firm is thinking aloud about an appropriate gearing level for the company: "The consultants I spoke to yesterday explained that some theorists adva
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