Cost of Capital

Why is it important for firms to consider cost of capital when making decisions to invest in long-term projects? Explain what sources of funds should be considered in computing weighted average cost of capital (WACC) and why it is important to consider WACC rather than the cost of just one source of financing. Provide an example of a major investment by your employer, or a large firm in Saudi Arabia you are familiar with, and explain what factors were probably considered in establishing a required rate of return on the investment and why.

Search for an academic or industry-related article. Select an article that relates to cost of capital and doing business in Saudi Arabia.

Direction:

For your discussion post, your first step is to summarize the article in two paragraphs describing what you think are the most important points made by the authors (remember to cite the information, as appropriate).

Be sure to support your statements with logic and argument

citing all sources referenced and inside the text.

APA style academic writing

6-8 paragraphs include ( introduction – body – conclusion )

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