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Basic Question 3 of 4
What is a potential advantage of the bottom-up approach in estimating the cost of capital?
A. It captures macroeconomic trends.
B. It provides a holistic view of the industry.
C. It considers company-specific risk factors.
D. It relies on market consensus.
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Learning Outcome Statements
explain top-down and bottom-up factors that impact the cost of capital;
CFA® 2025 Level II Curriculum, Volume 3, Module 18.