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cost of capital

   Also found in: Financial, Acronyms, Wikipedia 0.01 sec.
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Noun1.cost of capital - the opportunity cost of the funds employed as the result of an investment decision; the rate of return that a business could earn if it chose another investment with equivalent risk
opportunity cost - cost in terms of foregoing alternatives


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Despite the energy shown in the convergence of the technology, content and distribution sectors, many of the companies in these sectors are not achieving returns on capital above their cost of capital, says PricewaterhouseCoopers.
BAA's cost of capital is a key factor the CAA uses when it sets the charges.
The cost of capital can be lowered further if an asset can be classified as a trading asset, and therefore treated under Basel's Market Risk approach, which avoids counting the risk of default events.
 
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