Petrobrs WACC Comparison. The various estimates of the cost of capital for Petrobrs of Brazil appear to

Petrobrás’ WACC Comparison. The various estimates of the cost of capital for Petrobrás of Brazil appear to be very different, but are they? Reorganize your answers to Problems 10–14 into those costs of capital that are in U.S. dollars versus Brazilian reais. Use the estimates for 2004 as the basis of comparison.

Petrobrás Petróleo Brasileiro S.A. or Petrobras is the national oil company of Brazil. It is publicly traded, but the government of Brazil holds the controlling share. It is the largest company in the Southern Hemisphere by market capitalization and the largest in all of Latin America. As an oil company, the primary product of its production has a price set on global markets—the price of oil—and much of its business is conducted the global currency of oil, the U.S. dollar.