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Question

What do we call the price that a borrower must pay for debt capital? What is the price of equity capital? What are the four most fundamental factors that affect the cost of money, or the general level of interest rates, in the economy?

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EYS***754 2019-09-10 10:09:53
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Solution Preview

Interest Rate is the price that a borrower must pay for debt capital. It is often expressed in annual percentage which is levied upon the principal capital by the lender. The price of equity capital is commonly defined as the required rate of return on an equity investment by the shareholder. It can be also termed as the rate of return that can be 

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