Which of the following is the overall return the firm must earn on its existing assets to maintain the value of the stock?
AIRR (Internal Rate of Return)
BMIRR (Modified Internal Rate of Return)
CAAR (Average Accounting Return)
DWACC (Weighted Average Cost of Capital)
Correct answer
D. WACC (Weighted Average Cost of Capital)
Explanation
WACC (Weighted Average Cost of Capital) is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.