10. Stevenson-Kwo's WACC and Effective Tax Rate. Many MNES have greater ability to control and reduce their...
Question:
10. Stevenson-Kwo's WACC and Effective Tax Rate. Many MNES have greater ability to control and reduce their effective tax rates when expanding international operations. If Stevenson-Kwo was able to reduce its consolidated effective tax rate from 35% to 32%, what would be the impact on its WACC?
A Difference of Opinion: Petrobrs's WACC Petrobrs of Brazil, the subject of the mini-case in this chapter, is a Brazilian oil company with shares listed in New York. A number of major investment banking firms cover Petrobrs, and as a result, there seems to be a great difference of opinion on how to calculate its weighted average cost of capital.
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Fundamentals Of Multinational Finance
ISBN: 9780321541642
3rd Edition
Authors: Michael H. Moffett, Arthur I. Stonehill, David K. Eiteman