What is Palm’s cost of capital? What is Palm’s return on equity likely to be over the next several years?

Palm inc. (minicase) | Business & Finance homework help

Palm’s cost of capital is the amount of money it must pay for any new investments or acquisitions. This includes the costs associated with obtaining both debt and equity financing. In general, Palm’s cost of capital will depend on their risk profile and current market conditions.

Palm’s return on equity (ROE) is an important metric that measures how well they are utilizing their existing resources to generate returns in excess of shareholder’s investments. Possible ROEs over the next several years range widely, but some analysts have estimated that returns could be as high as 10-15%.