Case 2: Cost of capital. a. Tech produces shoes. It has an enterprise value of 500, debt equal to 200, cost of debt equa
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Case 2: Cost of capital. a. Tech produces shoes. It has an enterprise value of 500, debt equal to 200, cost of debt equa
Company Grate Paltry Dropa Equity beta 1.13 1.80 3.27 Debt/equity Ratio 0.15 1.06 3.52 Debt beta 0.00 0.15 0.30
Case 2: Cost of capital. a. Tech produces shoes. It has an enterprise value of 500, debt equal to 200, cost of debt equal to 5%, beta of equity of 0.8, and the corporate tax is 25%. The risk free rate is 3% and the equity risk premium is 6%. What is Tech Wacc?