Cost of capital-determinant in investment decisions
Cost of capital-determinant in investment decisions

Summary/Abstract: The efficiency of the investments is affecting by various factors. One of the most important factors that determine the efficiency of investment represents the cost of capital. Regardless of the size of revenues that may be provided by an investment whether it is for real or financial investment, the price of capital can significantly affect the investment decision of acceptance a given investment project or purchase of a given financial instrument stocks, bonds and est. The cost of capital is a complex economic variable, given that its size influence by several factors, from external and internal nature, which implies the need for application of quantitative and qualitative analysis in order to provide the best possible estimate of the cost of capital. The variables taken into account in determination of the cost of capital will depend on the source of finance of a given investment.

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