| asset beta | The sensitivity of a firm's asset value to that of the overall economy.
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| cost of equity capital | The required return on the company's common stock in capital markets. It is also called the equityholders' required rate of return because it is what equityholders can expect to obtain in the capital market. It is a cost from the firm's perspective.
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| equity beta | The asset beta adjusted for leverage.
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| operating leverage | The degree to which a company's costs of operation are fixed as opposed to variable. A firm with high operating costs compared to a firm with a low operating leverage, and hence relatively larger changes in EBIT with respect to a change in the sales revenue.
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| weighted average cost of capital (WACC) | The average cost of capital on the firm's existing projects and activities.
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