Find cost of debt - estimate cost of equity

Assignment Help Financial Management

Reference no: EM13547485

WACC is the weighted average of costs of debt, preferred stock and equity. Choose (please run first company by me) a rela-tively large non-financial public company (market cap more than 3B) and calculate its WACC. You should then show:

1. how you estimated the percentage of capital that comes from debt, and common equity

2. use CAPM tc estimate cost of equity

3. find cost of debt (you will also need to estimate an average tax rate)

(a) either via yield of actual outstanding bonds of the company, or

(b) via dividinc amount of interest expense by the outstanding debt

Reference no: EM13547485

Questions Cloud

Find the speed of the ram at the instant of contact : A heavy-duty stapling gun uses a 0.131-kg metal rod that rams against the staple to eject it. The rod is pushed by a stiff spring called a "ram spring" (k = 31800 N/m).

The bolts on the cylinder head of engine require tightening : The bolts on the cylinder head of an engine require tightening to a torque of 92 m·N. If a wrench is L = 30 cm long, what force perpendicular to the wrench must the mechanic exert at its end? If the six-sided bolt head is 15 mm in diameter, estimate ..

Estimate what is the resistance of the wire : A 61.0 m length of insulated copper wire is wound to form a solenoid of radius 2.2 cm. What is the resistance of the wire

Equilibrium is to be taken as a negative distance : A 66 trampoline artist jumps vertcally upward from the top of a platform with a speed of 5.4 . A) What is his speed as he lands on the trampoline, 3 m below his jump off point? B) If the trampoline behaves like a spring with spring stiffness constant..

Find cost of debt - estimate cost of equity : How you estimated the percentage of capital that comes from debt, and common equity - find cost of debt

Define the van der waals parameters : Express the van der Waals parameters a = 0.751 atm dm^6 mol^-2 and b = 0.0226 dm^3 mol^-1 in SI base units

Compute the minimum thickness of the oil film : A thin film of oil (n = 1.26) is located on smooth, wet pavement. When viewed from a direction perpendicular to the pavement, What is the minimum thickness of the oil film

Bromopentane is isolated define the % yield of the reaction : Using the reaction below determine the limiting reagent, theoretical and % yield. 7.50ml of 1 pentene was allowed to react with 15 ml of HBr (9.0M). If 8.00 mL of 2 bromopentane is isolated what is the % Yield of the reaction

Identify the steps that a musician would have to take : First, identify the steps that a musician would have to take in order to gain the commercial success necessary to earn his/her livelihood from selling music. Outline the actions this musician would have to complete which would make him/her suc..

User Account

All Pages