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what is the weighted average cost of capital wacc. To generate estimates of the weighted average cost of capital WACC for five different companies pick companies from different industries such that you find a relatively wide range of WACC estimates. The price of the bond today is 1075.
What Is Wacc Formula And Its Uses Cost Of Capital Corporate Tax Rate Financial Decisions from in.pinterest.com
This is why it is also called cost of capital. As a newly-hired financial analyst with Traid Winds Incorporated you have been asked to calculate the firms weighted average cost of capital WACC. Represents the required return firms should earn to satisfy their investors.
The weighted average cost of capital WACC is the rate that a company is expected to pay on average to all its security holders to finance its assets.
Weighted Average Cost of Capital WACC Here again is the formula for WACC. 6 A companys weighted average cost of capital. If the project IRR is less than WACC the project will be rejected and vice versa. 75 points total a A 14-year bond with an 8 percent semiannual coupon has a par value of 1000.
