In calculating the cost of capital, the best estimate for the cost of debt is: Group of answer choices Weighted average interest rate paid on company's past borrowing YTM on the company's long-term debt at present time Determined by iterative process, where you change the weight of debt until you reach the lowest cost of capital Current 10-yr Treasury rate plus default premium based on the company's credit rating Current 1-yr Treasury bill plus default premium based on the company's credit rating

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The best estimate for the cost of debt in calculating the cost of capital is typically the Yield to Maturity YTM on the companys longterm debt at the present time This is because the YTM reflects the ... View the full answer