• Please choose three very different industries from this list of various industries, other than utility and software.
  • First, clearly list the cost of equity, cost of debt, and cost of capital for the three industries.
  • Discuss why those inputs might be different in each industry? (Think of terms of riskiness, consistency of cash flows, collateral, etc)
• Now compare the Utility industry and the Software (internet) industry.
  • What proportion of debt (D/D+E) do we see and what proportion of equity (E/E+D) do each use to finance themselves?
  • Why is it that utility companies often have high amounts of debt and software companies often have low amounts of debt? (Think of terms of riskiness, consistency of cash flows, collateral, etc)
• Advertising
• aerospace
• apparel
• auto parts
• banks
• cable tv
• computer science