cost of debt capital

Definition

The interest rate a company is paying on all of its debt, such as loans and bonds.

Use this term in a sentence

Because we could not negotiate a decrease in the cost of debt capital with the bank, the company went under.

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You should try to make sure that you know what your cost of debt capital will be before you take on any loan.

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The cost of debt capital was substantial so we had suggested that the company consider equity financing to improve its financial health.

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