Why is the cost of capital important to capital budgeting

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Question -

1. A representative of a brokerage firm states that retained earnings should be the first source of financing for a company, since they are free of charge. Do you agree with this statement? How do they agree and how do they differ? Why?

2. Why is the cost of capital important to capital budgeting decisions?

3. Why is there a variety of techniques for the valuation of investment projects?

Reference no: EM133165392

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