COST OF CAPITAL/FUNDS Definition

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COST OF CAPITAL/FUNDS is the rate of return that a business could earn if it so chose other investments with the equivalent risks. Also can be stated as opportunity cost of the funds used due to the investment decision.

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EFFECTIVE MATURITY is the date used in place of the final maturity for bonds with call, put or prepayment features. This date mathematically incorporates the effect of those optional maturity dates.

EXTERNAL is from or between other countries, e.g. external commerce; or, happening, arising or located outside or beyond a company, e.g. external influences.

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