Methodological Aspects of a Simulation-based Model in the Determination of the Cost of Capital

Abstract

Various groups of methods are applied in the field of scientific research concerning the determination of the cost of capital. Among them are simulation-based models, which are gaining popularity in modern economy and are recommended by numerous researchers. This paper examines a simulation- based model developed by Gleißner and Ernst (2019), focusing on its potential methodological application. The study explores its advantages, shortcomings, and potential issues that may arise during its implementation.