{"id":33732,"date":"2024-04-15T09:20:54","date_gmt":"2024-04-15T09:20:54","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=33732"},"modified":"2024-04-15T09:20:54","modified_gmt":"2024-04-15T09:20:54","slug":"which-one-of-the-following-is-not-a-method-of-calculating-cost-of-equity-capital","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/which-one-of-the-following-is-not-a-method-of-calculating-cost-of-equity-capital\/","title":{"rendered":"Which one of the following is not a method of calculating cost of equity capital?"},"content":{"rendered":"

[amp_mcq option1=”Dividend yield method” option2=”Dividend yield plus growth method” option3=”Yield to maturity method” option4=”Earnings yield method” correct=”option3″]<\/p>\n

The correct answer is C. Yield to maturity method.<\/p>\n

The dividend yield method, dividend yield plus growth method, and earnings yield method are all methods of calculating the cost of equity capital. The yield to maturity method is a method of calculating the return on a bond. It is the annual interest rate that a bondholder receives on a bond, assuming that the bond is held to maturity.<\/p>\n

The dividend yield method is a simple way to calculate the cost of equity capital. It is the annual dividend paid by a company divided by the current market price of the company’s stock.<\/p>\n

The dividend yield plus growth method is a more complex way to calculate the cost of equity capital. It takes into account the company’s dividend yield and its expected growth rate.<\/p>\n

The earnings yield method is a way to calculate the cost of equity capital that is based on a company’s earnings. It is the company’s earnings per share divided by the current market price of the company’s stock.<\/p>\n

The yield to maturity method is not a method of calculating the cost of equity capital because it is a method of calculating the return on a bond. The cost of equity capital is the return that investors expect to earn on their investment in a company’s stock.<\/p>\n","protected":false},"excerpt":{"rendered":"

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