Citigroup SmithBarney (Dollar). Citigroup regularly performs a U.S. dollar-based discount cash flow (DCF) valuation of Petrobrs in

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Citigroup SmithBarney (Dollar). Citigroup regularly performs a U.S. dollar-based discount cash flow (DCF) valuation of Petrobrás in its coverage.

That DCF analysis requires the use of a discount rate on which they base the company’s weighted average cost of capital. Evaluate the methodology and assumptions used in the estimates of Petrobrás WACC (see the following table).

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Multinational Business Finance

ISBN: 9781292270081

15th Global Edition

Authors: David Eiteman, Arthur Stonehill, Michael Moffett

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Question Posted: Jun 04, 2024 02:18 AM

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Citigroup SmithBarney (Dollar). Citigroup regularly performs a U.S. dollar-based discount cash flow (DCF) valuation of Petrobrs in

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July 28, 2005 March 8, 2005 Capital Cost Components 2003A 2004E 2003A 2004E Risk-free rate 9.400% 9.400% 9.000% 9.000% Levered beta 1.07 1.09 1.08 1.10 Risk premium Cost of equity Cost of debt 5.500% 5.500% 5.500% 5.500% 15.285% 15.395% 14.940% 15.050% 8.400% 8.400% 9.000% 9.000%

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Multinational Business Finance

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