Capital Costs and How to Calculate Them

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17 pages and 12 sources used. This paper provides an overview of the different methods for calculating the costs of capital in the business environment. This paper relates a number of methods that include assessing the cost of debt, determining the presence of existing equity and the application of different economic models, including the capital asset pricing model. This paper argues the need to define the parameters of capital costs in order to create effective and usable cost calculations.