The average cost associated with each additional dollar of financing for investment projects is
A) the incremental return.
B) the marginal cost of capital.
C) CAPM required return.
D) the component cost of capital.

Question

Quizplus · Accepted Answer

The average cost associated with each additional dollar of financing for investment projects is known as the marginal cost of capital. It represents the cost of obtaining additional funds and is an essential consideration in determining whether an investment project is financially viable.

The Average Cost Associated with Each Additional Dollar of Financing