TL Division of Giant Bank has assets of $14.4 billion. During the past year, the division had

Question:

TL Division of Giant Bank has assets of $14.4 billion. During the past year, the division had profits of $1.8 billion. Giant Bank has a cost of capital of 8 percent. Ignore taxes.

Required

a. Compute the divisional ROI.

b. Compute the divisional RI.

Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...