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What is WACC for you firm? Based on everything you have done in this assignment, give...

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Finance

  • What is WACC for you firm? Based on everything you have done inthis assignment, give a hard estimate for the WACC. What would yousuggest managers use and why?
  • Why is it important to estimate a firm’s WACC? What is it usedfor?
  • What should management do if none of the available projectsearn an adequate WACC?
  • Why do we use an after-tax figure for the cost of debt but notfor the cost of equity?
  • Should the company you evaluated use the WACC as the hurdlerate for all projects? Explain.

Answer & Explanation Solved by verified expert
3.9 Ratings (654 Votes)
1WACC is called weighted average cost of capital to the firm Here each type of financing option like debt equity preferred shares are given weight accordingly and we will calculate average cost of capital As the assignment not    See Answer
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Transcribed Image Text

What is WACC for you firm? Based on everything you have done inthis assignment, give a hard estimate for the WACC. What would yousuggest managers use and why?Why is it important to estimate a firm’s WACC? What is it usedfor?What should management do if none of the available projectsearn an adequate WACC?Why do we use an after-tax figure for the cost of debt but notfor the cost of equity?Should the company you evaluated use the WACC as the hurdlerate for all projects? Explain.

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