You own a building that is worth 55,600 dollars and is expected to produce quarterly cash...
You own a building that is worth 55,600 dollars and is expected to produce quarterly cash flows of 950 dollars forever. The first quarterly cash flow is expected in 3 months from today. What is the expected quarterly cost of capital for the building? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
Homework Answers
Quarterly cost of capital:
= $950/$55,600
= 0.0171
Hence, quarterly cost of capital is 0.0171
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