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Discuss the detailed steps of how to calculate the weighted average of cost of capital (WACC). How to determine the weight of each financing source.
- Discuss the detailed steps of how to calculate the weighted average of cost of capital (WACC).
- How to determine the weight of each financing source.
- How to estimate the firms cost of debt, cost of equity, and cost of preferred stock. Explain the specific methods.
- Suppose the firm estimates its WACC to be 10%.
- Should the WACC be used to evaluate all its potential projects, even if they vary in risk? Explain.
- Would the NPVs change if the WACC changed? Explain.
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Bond Markets Analysis And Strategies
Authors: Frank J. Fabozzi
4th Edition
0130402664, 9780130402660
