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Question · The capitalisation rate

The Meridian group finances plant P, under construction, with a specific borrowing. It is also building warehouse Q, financed by its general borrowings (a bond and a bank loan). The specific borrowing for plant R, already completed, is still outstanding. In a few sentences, justify the borrowings you would include in the capitalisation rate for warehouse Q.

Your answer

Judgment question: compare your answer with the criteria and the model explanation.

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