Explain how the following risks may affect these 3 sources of financing in international capital markets. In addition, explain how these risks may influence a company’s international weighted average cost of capital (WACC).

Exchange Rate Risk and Capitalization

Companies seek the lowest average rate of financing costs to capitalize the business. Common sources of financing are as follows:

Common stock equity
Preferred stock equity
Bond debt

Explain how the following risks may affect these 3 sources of financing in international capital markets. In addition, explain how these risks may influence a company’s international weighted average cost of capital (WACC):

Default risk
Inflation
Interest rate risk
Stock and market volatility

Last Completed Projects