Question
At the end of 2018, the long-term risk-free rate is 2.5% and the market risk premium is 6%. The company has a beta of 1.3
At the end of 2018, the long-term risk-free rate is 2.5% and the market risk premium is 6%.
The company has a beta of 1.3 and is trading at $13 per share. They borrow funds at a rate of
4.0% and have a 25% tax rate.
@ Dec. 31, 2018, determine their:
a. Invested Capital
b. ROIC
c. WACC
d. EVA
Use total Equity for your calculations.
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Fundamentals of Investing
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
12th edition
978-0133075403, 133075354, 9780133423938, 133075400, 013342393X, 978-0133075359
