What will be the company cost of capital per car

Reference no: EM131936473

Question: Assume that a car-rental company buys cars for $ 20,000 each and rents them out to other businesses. The company faces a nominal interest rate of 10 percent per year, and car prices are rising at 6 percent per year. If cars depreciate at 30 percent per year, what will be the company's cost of capital per car?

Reference no: EM131936473

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