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An in-depth interview:
Cost of Capital
The average rate of return a company must pay to its security holders to fund its assets, integrating the cost of debt and equity.
Incremental Cash Flows
The additional cash flow from taking on a new project, considered essential for analysis in capital budgeting.
Sunk Costs
Costs that have already been incurred and cannot be recovered or altered, not affecting future business decisions.
Capital Budgeting
Capital budgeting is the process by which a business evaluates and selects long-term investments based on their potential to generate profitable returns over time.
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