What is the wacc it should use for the project

Assignment Help Financial Management

Reference no: EM131570468

Gnomes R Us is considering a new project. The company has a debt–equity ratio of .48. The company’s cost of equity is 11.8 percent, and the aftertax cost of debt is 5.6 percent. The firm feels that the project is riskier than the company as a whole and that it should use an adjustment factor of +3 percent. What is the WACC it should use for the project?

Reference no: EM131570468

Questions Cloud

Develop a process that firms can use : REVIEW THE CASE STUDY THEN ANSWER THE QUESTIONS BELOW - Develop a process that firms can use when identifying and developing supply chain alliances

Do you see room for improvement : Do you see room for improvement? How would this assessment be different for other types of customers? In short, you are the target market.

Tax income change as a result of change in depreciation : By how much will net after-tax income change as a result of the change in depreciation?

Contribute by addressing the questions : Once you have completed the Laws of Wealth please contribute by addressing the following questions.

What is the wacc it should use for the project : Gnomes R Us is considering a new project. What is the WACC it should use for the project?

Describe the legal barriers to healthcare access : Explain at least three public health campaigns targeting access to healthcare for women and/or minorities.

Discuss the euclidean algorithm : How many divisions are required to find gcd(144, 233) using the Euclidean algorithm?

Ensure that your viewpoint and purpose are clearly stated : Ensure that your viewpoint and purpose are clearly stated. Demonstrate logical and appropriate transitions from one idea to another

What is stock expected price five years from now : What is the stock's expected price 5 years from now?

User Account

All Pages