Which of the Following Is Not a Component Used in Calculating

question 46

Multiple Choice

Which of the following is not a component used in calculating the cost of capital?

• A)The cost of short-term debt
• B)The cost of long-term debt
• C)The cost of retained earnings
• D)The cost of preferred stock
• E)The cost of common stock

---

Definitions:

Federal Law

Laws passed by the national government of the United States that apply throughout the country.

State Law

State law refers to the legal rules and regulations that are enacted and enforced by individual states within a country, as opposed to federal or national laws.

Bankruptcy Claims

Rights to payment recognized by a bankruptcy court from entities or individuals who have filed for bankruptcy protection.

Individual Debts

Financial obligations or amounts of money that are owed by a single person, as opposed to those owed by a group or company.