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Bond Yield Plus Risk Premium Method Definition | Becker

Accounting Dictionary

Bond Yield Plus Risk Premium Method

The bond yield plus risk premium method is a method for determining the cost of equity capital (common stock or retained earnings) as the firm's cost of debt capital plus an equity risk premium (the compensation for taking the additional risk of equity ownership versus the holding of debt). See also capital asset pricing model and dividend yield plus growth rate method.

Related Terms:

Capital Asset Pricing Model (CAPM) [BAR]Dividend Yield Plus Growth Rate Method [BAR]Back to Dictionary

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