The cost of debt capital is the ratio of interest payable on ---------

Related MCQs

• Consider the below mentioned statements: 1. A debt-equity ratio of 2:1 indicates that for every 1 unit of equity, the company can raise 2 units of debt. 2. The cost of floating a debt is greater than the cost of floating an equity issue. State True or False:
• If the weighting of equity in total capital is 1/3, that of debt is 2/3, the return on equity is 15% that of debt is 10% and the corporate tax rate is 32%, what is the Weighted Average Cost of Capital (WACC)?
• The type of debt whose rate of interest changes according to the changes in the rate of interest payable on gilt edged securities or the prime lending rate of the bank is called
• Debt-to-total assets (D/TA) ratio is .4. What is its debt-to-equity (D/E) ratio?
• The cost of debt capital if interest rate is 15% and tax rate is 40% is
• A company can increase its value and reduce the overall cost of capital by increasing the proportion of debt in its capital structure according to ----- approach
• Cost of Equity Share Capital is more than cost of debt because:
• In case of Net Income Approach, when the debt proportion is increased, the cost of debt:
• The use of long term fixed interest bearing debt and preference share capital along with equity shares is called
• A company should arrange the capital structure in such a way that there is maximum flexibility in the capital and cost of capital is