Question
Select a firm from the DOW list (30 stocks that represent the Dow Jones Industrial Average) and tell us the following: What is the WACC
Select a firm from the DOW list (30 stocks that represent the Dow Jones Industrial Average) and tell us the following:
What is the WACC (weighted average cost of capital) for this firm?
If you were CEO (chief executive officer) and wanted to undertake a significant project for this firm (100 million in outlay required), what type of long term financing might you consider (stock issuance [common or preferred]; debt [what maturity].
What level of risk (your opinion) might this combination of capital outlay present to the firm, and, what return (rate of return) would you recommend to the board of directors?
Any suggestions?
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