The document discusses the concepts of cost of capital and working capital. It defines cost of capital as the expected rate of return required to finance an investment. The cost depends on the type of financing used, whether debt, equity, or a mixture. There are different types of cost of capital classified by nature and usage. The document also explains how to calculate the weighted average cost of capital using formulas for cost of debt, cost of equity, and the weighted average. It then defines working capital as current assets minus current liabilities, and discusses factors that influence working capital requirements, different types of working capital needs, and working capital management policies.