Question
Hey im unsure in how how to plug the numbers into the formula Im using WACC = (weight of equity x cost of equity )/
Hey im unsure in how how to plug the numbers into the formula
Im using WACC = (weight of equity x cost of equity )/ (weight of debt x Cost of debt)
80/200 --> .40 for my weight of equity 120/200 ---> .60 for weight of debt
im unsure how to break down the other numbers. please explain and show how thank you will give points quick.
MassTool Corporation is worth $200 million with $80 million of equity and the remainder as debt. The common stock has a dividend yield of 2% and a capital gain yield of 10%. The cost of the firm's debt is 3%. From these data the weighted average cost of capital is percent.
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