What will happen to the cost of debt funds for cost of capital purposes if a company should go into a period when it has negligible profits and pays no taxes ...

The tax shield associated with the use of debt funds would be lost at least until profits wer ...

What will happen to the cost of debt funds for cost of capital purposes if a company

Question:

What will happen to the funds for purposes if a company should go into a period when it has negligible profits and pays no taxes?
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... Cost Of Debt
The cost of debt is the effective interest rate a company pays on its debts. It’s the cost of debt, such as bonds and loans, among others. The cost of debt often refers to before-tax cost of debt, which is the company's cost of debt before taking...