APPLE:

find the market capitalization (E) as well as the for any publicly traded company. For the publicly traded company Apple.

Clicking on the symbol for a given bond issue will lead you to the current amount outstanding and the yield to maturity. You are interested in both. The total of all bonds outstanding is D in the above formula.

If you like, you can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company.

Assumptions:

As you recall, the formula for WACC is:

rWACC = (E/E+D) rE + D/(E+D) rD (1-TC)

The formula for the required return on a given equity investment is:

ri= rf + i * (RMkt-rf)

RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 5% unless you can develop a better number.

rf is the risk-free rate. The risk-free rate is normally the yield on US Treasury securities such as a 10-year treasury. For this assignment, please use 3.5%.

You may assume a corporate tax rate of 40%.

report that contains the following elements:

Your calculated WACC

How data was used to calculate WACC (provide the formula and the formula with your values substituted)

Sources for your data

A discussion of how much confidence you have in your answer, including what the limiting assumptions you made were, if any

Includea MicrosoftExcelfile showing your WACC calculations discussed above.