Question
Increase/decrease your WACC by 1% each time. Increase/decrease your long-term growth rate by 0.5% each time. Which factor(s) is your equity value most sensitive to?
Increase/decrease your WACC by 1% each time. Increase/decrease your long-term growth rate by 0.5% each time. Which factor(s) is your equity value most sensitive to?
- Initial WACC is 11.43440%
- Initial Growth rate is 3%
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The equity value is the present value of all future cash flows so it is sensitive to t...
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Fundamentals of Corporate Finance
Authors: Berk, DeMarzo, Harford
2nd edition
132148234, 978-0132148238
