XYZ has 200M of debt and 500M of Equity on its balance sheet
The firm's bonds have a coupon rate of 6% (assume annual payments) 20 year maturity $1000 face value These bonds currently are selling for 920 The firm's tax rate is 30% and the flotation costs of issuing bonds are 5% The firm's stock sells for 25 per share, currently pays for 1.80 in dividends Investors expect these dividends to grow at 4% per year forever The flotation cost of issuing shares is 8% The book value of equity is 10 per share The firm plans to raise 20% of its equity needs externally and 80% of it What is the firm's
A Cost of debt
B Cost of internal equity
C Cost of external equity
D Weighted Average Cost of Capital
WACC is a component used in finance to measure the company's cost of capital, usually as a discounting factor and the companies use debt or equity for financing.
how to calculate WACC how to calculate WACC how to calculate WACC how to calculate WACC
Wacc Farmula
WACC will increase.
It is to use science for a practical job or to solve a problem.
What impact does WACC have on capital budgeting and structure?
Accounting is a phylosophical science that helps to a language by which you can understand any information passed by a business. Finance is an important tool of a busuness that helps to solve any kind of finantial problem faced by the business.
because of WACC nature, there are no same utility, and that's why none make same calculation. so WACC=X2+2X3+5X2=0 ? because of WACC nature, there are no same utility, and that's why none make same calculation. so WACC=X2+2X3+5X2=0 ?
When you analyze a problem you look it over which is what analyzing means. You look over the problem and then you solve it. When you solve a problem you solve it and you use certain steps and solve it but of course everyone has there ways to solve a problem but some people have ways to solve it by just analysing it. That is the difference.
relationship between WACC and required rate of return.
It didn't solve any problem it was invented as a sport not as a way to solve anything...
no it can not solve the problem