Abstract
The paper reviewed various literatures on of cost of Capital to examine and identify the feasible methods for this phenomenon. The methodology of computation that has been in use for the period has not changed. Though different methods have been presented by the several writers but none has been generally accepted in literature. Most of the studies on cost of capital and information asymmetry used CAPM, while majority on other studies mostly used implied cost of capital (ICC).The obvious advantage of this reverse approach (ICC) is that estimates of the expected rate of return are based on forecasts rather than extrapolation from historical data (estimates via market model, the empirical of the Sharpe-Linter capital asset pricing model, or variants of the Fama & French (1992) three/four model). If Cost of Capital should be in predictable cost form, then, the appropriate valuation model should use forecasted cash flows.
Hubs, H., Chizoba, O & Bassey, E (2021). COST OF CAPITAL: METHODOLOGY OF COMPUTATION REWIEW. Afribary. Retrieved from https://track.afribary.com/works/cost-of-capital-methodology-of-computation-rewiew
Hubs, Hkay, et. al. "COST OF CAPITAL: METHODOLOGY OF COMPUTATION REWIEW" Afribary. Afribary, 28 Dec. 2021, https://track.afribary.com/works/cost-of-capital-methodology-of-computation-rewiew. Accessed 23 Nov. 2024.
Hubs, Hkay, Onyimba Chizoba and Ewah Bassey . "COST OF CAPITAL: METHODOLOGY OF COMPUTATION REWIEW". Afribary, Afribary, 28 Dec. 2021. Web. 23 Nov. 2024. < https://track.afribary.com/works/cost-of-capital-methodology-of-computation-rewiew >.
Hubs, Hkay, Onyimba Chizoba and Ewah Bassey . "COST OF CAPITAL: METHODOLOGY OF COMPUTATION REWIEW" Afribary (2021). Accessed November 23, 2024. https://track.afribary.com/works/cost-of-capital-methodology-of-computation-rewiew