weighted average cost of capital

... Trang 1BỘ KẾ HOẠCH VÀ ĐẦU TƯ HỌC VIỆN CHÍNH SÁCH VÀ PHÁT TRIỂN BÀI TẬP LỚN CHỦ ĐỀ : WEIGHTED AVERAGE COST OF CAPITAL (WACC) BỘ MÔN : TOÁN TÀI CHÍNH GIẢNG VIÊN : TRẦN TRỌNG NGUYÊN NHÓM THỰC HIỆN ... truyền đạt, nhóm 7 chúng em xin trình bày lại những gì mình đã tìm hiểu về vấn đề “Weighted Average Cost of Capital” gửi đến thầy Dù đã có nhiều nỗ lực, nhưng vì hiểu biết còn hạn hẹp cũng như ... TÀI LIỆU THAM KHẢO : 10 Trang 5I TỔNG QUAN VỀ WACC 1 Khái niệm - WACC là viết tắt của Weighted Average Cost of Capital (hay, Chi phí sử dụng vốn bình quân). - Chi phí sử dụng vốn bình quân là chi

Ngày tải lên: 23/05/2024, 11:47

... to equity capital, we introducethe notion of cost of capital We analyse the impact of the cost of capital on the valuation of lifeinsurance contracts with guarantees In the last part of this thesis ... 2.2 The case of a ’true’ guarantee 6 2.3 The case of a conditional guarantee 8 3 Cost of Capital 11 3.1 Incomplete markets and cost of capital 11 3.2 Pricing under cost of capital ... the term of "cost of capital" And we consider thecost of capital to be entirely explained by the risk aversion of the policyholder who can not access or replicate the payoff of the contract

Ngày tải lên: 13/04/2013, 13:04

... the cost of capital and the specific sources of capital associated with the cost of capital. • Determine the cost of debt and preference share capital. • Calculate cost of ordinary share capital, ... Amount of funds available from financing source j at a given cost w j = Capital structure weight for financing source j Weighted Marginal Cost Of Capital Trang 23Weighted Marginal Cost Of Capital ... sale of new shares. Finding The Cost Of Ordinary Share Equity Capital g N D r n Trang 18Weighted Average Cost Of structure structure. Trang 19Duchess Limited has calculated the costs of the

Ngày tải lên: 16/12/2013, 14:57

... along with the concept of the weighted average cost of capital (WACC), to develop a corporate cost of capital for use in capital budgeting.We begin by describing the logic of the WACC, and why ... subjective risk-adjusted costs of capital • List some problem areas in estimating the cost of capital Chapter 9 The Cost of Capital LEARNING OBJECTIVES Trang 2Chapter 9 uses the rate of return concepts ... account for flotation costs • Calculate the firm’s composite, or weighted average, cost of capital • Identify some of the factors that affect the overall, composite cost of capital • Briefly explain

Ngày tải lên: 01/07/2014, 21:28

... Chapter 7 – The Cost of Capital 23/8/2012 CHAPTER 7 The Cost of Capital 7.1 Cost of Capital Components - Debt - Preferred Equity - Common Equity 7.2 Weighted Average Cost of Capital 2 ... calculation of the cost of capital We do adjust for these items when calculating the cash flows of a project, but not when calculating the cost of capital B02022 – Chapter 7 – The Cost of Capital ... estimate of rs? Method Estimate r d + RP 14.0% Average 14.0% Trang 829 B02022 – Chapter 7 – The Cost of Capital 23/8/2012 7.2 Weighted Average Cost of Capital 30 B02022 – Chapter 7 – The Cost

Ngày tải lên: 12/07/2014, 14:12

... preferred time for estimating average rates of return Thus, using a 10-year average is likely to be misleading at the total spread of returns or simply the spread of unexpectedly low returns ... comprised of one-third T-Bills and two-thirds a portfolio which is half Dell and half Microsoft Because the risk of T-bills is zero, the portfolio standard deviation is two-thirds of the standard ... almost entirely on the average covariance of the securities in the portfolio (measured by beta) and on the standard deviation of the market portfolio Thus, for a portfolio made up of 100 stocks, each

Ngày tải lên: 14/08/2014, 11:20

... incorporate tax effects in the cost of capital Therefore, focus on after-tax costs. Only cost of debt is affected. Trang 5(embedded) costs or new ( marginal ) costs? The cost of capital is used primarily ... calculating the cost of capital. Trang 4Should we focus on before-tax or Tax effects associated with financing can be incorporated either in capital budgeting cash flows or in cost of capital. Most ... Trang 1CHAPTER 9 The Cost of Capital Debt Preferred WACC Trang 2What types of long-term capital do firms use? Preferred stock Trang 3Capital components are sources of funding that come from

Ngày tải lên: 30/10/2014, 08:23

... Preferred Stock • The Weighted Average Cost of Capital • Divisional and Project Costs of Capital • Flotation Costs and the Weighted Average Cost of Capital Trang 4Why Cost of Capital Is Important ... cost of capital • Understand pitfalls of overall cost of capital and how to manage them Trang 3Chapter Outline• The Cost of Capital: Some Preliminaries • The Cost of Equity • The Costs of Debt ... 19The Weighted Average Cost of Capital • We can use the individual costs of capital that we have computed to get our “average” cost of capital for the firm. • This “average” is the required return

Ngày tải lên: 26/03/2015, 20:07

... equity) ke = cost of external equity, or cost of issuing new common stock k o = firm’s overall cost of capital, or a weighted average cost of capital COST OF DEBT The before-tax cost of debt can ... element of capital has a component cost that is identified by: ki = before-tax cost of debt kd = k i(1− t) = after-tax cost of debt, where t= tax rate kp = cost of preferred stock ks = cost of retained ... working capital management The cost of capital is used either as a discount rate under the NPV method or as a hurdle rate under the IRR method The cost of capital is computed as a weighted average of

Ngày tải lên: 06/04/2015, 18:04

... incorporate tax effects in the cost of capital Therefore, focus on after-tax costs. Only cost of debt is affected. Trang 5(embedded) costs or new ( marginal ) costs? The cost of capital is used primarily ... calculating the cost of capital. Trang 4Should we focus on before-tax or Tax effects associated with financing can be incorporated either in capital budgeting cash flows or in cost of capital. Most ... Trang 1CHAPTER 9 The Cost of Capital Debt Preferred WACC Trang 2What types of long-term capital do firms use? Preferred stock Trang 3Capital components are sources of funding that come from

Ngày tải lên: 06/04/2015, 19:41

... the cost of capital, the firm will under-invest. The Cost of Capital Trang 17Weighted Average Cost of Capital (WACC):Cost of debt (rd): interest rate paid to creditors net of taxes Cost of equity ... expected rate of return exceeds the cost of capital For a firm under rate-of-return regulation, if the permitted rate of return is set above the cost of capital (or the required rate of return), ... = 1 -= = (1 + r) (1 + g) 1 - B Trang 24The Cost of Equity CapitalThe Cost of Equity Capital 2 Capital asset pricing model (CAPM): Cost of equity capital = risk-free rate + beta (market rate

Ngày tải lên: 04/10/2015, 20:08

... The cost of capital used to evaluate a project should be the cost ofthe specific type of financing used to fund that project b The cost of debt used to calculate the weighted average cost of capital ... calculating the weightedaverage cost of capital (WACC) b All else equal, an increase in flotation costs will increase the cost of retained earnings c When calculating the weighted average cost of capital, ... capital budget level is a weighted average of the marginal cost of each relevant capitalcomponent that makes up the firm’s target capital structure b The weighted average cost of capital is calculated

Ngày tải lên: 16/03/2017, 10:36

... equity cost of capital Keywords Weighted Average Cost of Capital, WACC, firm valuation, capital budgeting, equity cost of capital JEL codes D61, G31, H43 ii A Note on the Weighted Average Cost of Capital ... value of the firm for the beginning of each period This is the well known expression for the weighted average cost of capital It can be shown that under the assumption of the discount rate of tax ... perpetuity List of symbols Ku The cost of the unlevered equity Kd The cost of debt (assumed constant) D Market value of debt Ken Levered cost of equity at year n EL Market value of levered equity...

Ngày tải lên: 07/03/2014, 00:20

... discuss the effects of disclosure regulation on the cost of capital of firms Based on our framework, increasing the quality of mandated disclosures should in general move the cost of capital closer ... price and on the cost of capital of reducing the assessment of firmvariance The firm-specific variance reduction effect is an important factor in the cost of capital analysis of Easley and O’Hara ... results is the different definition of cost of capital In particular, Hughes et al define cost of capital as the difference between beginning -of- period price and end -of- period expected cash flows,...

Ngày tải lên: 06/03/2014, 21:20

... cost of capital, all of the following are true except that A The cost of capital of a firm is the weighted average cost of its various financing components B The calculation of the cost of capital ... equity capital will increase B Yes, because the cost of equity capital will decrease C Yes, because the weighted- average cost of capital will decrease D No, because the weighted- average cost of capital ... C The cost of equity financing D The weighted- average cost of capital 28 The weighted- average cost of capital approach to decision making is not directly affected by the: A proposed mix of debt,...

Ngày tải lên: 25/03/2014, 12:32

... further test the impact of audit tenure and auditor opinion on cost of capital and find that cost of capital is inversely proportional to auditor tenure, and that cost of capital for the client ... effect of the two audit quality attributes, size and industry specialization, on the cost of capital of client firms Specifically, I examine which roles of auditing affect the cost of capital of the ... examine the impact of different attributes of the auditor and the audit on the cost of capital of the client firm I find that the cost of capital is inversely proportional to the length of the auditor...

Ngày tải lên: 01/06/2014, 14:04

... the SOX Act 13 1.4 Cost of Capital Cost of capital is one of the most important benchmarks to evaluate the ability of firms to invest their funds and to evaluate the quality of their existing ... a lower cost of equity capital Financial reporting of low quality earnings increases the risk of inefficient resource allocation and could increase the cost of capital The incidence of earnings ... map into the effect of the cost of equity capital In terms of potential fraudulent activity, a distinct disadvantage of earlier research dealing with changes in cost of equity capital estimates...

Ngày tải lên: 03/06/2014, 00:49

... firms is compared to the cost of capital of Big-audit firms in terms of the expected effect of the level of audit quality provided on the cost of capital The cost of capital is split into two ... reducing measurement error of audit quality 2.4 Cost of Capital The cost of capital for a firm is a weighted sum of the cost of equity and the cost of debt Firms finance their operations by three ... set of hypotheses covers the cost of capital issues and states that cost of debt for clients of SecondTier audit firms is higher than cost of debt for clients of Big-audit firms Similarly, the cost...

Ngày tải lên: 03/06/2014, 02:15

... 2006, all would have been lost for her in the first two years of its existence 30 • THE COST OF CAPITALISM That is, of course, because of what happened to house prices From 2000 to 2006 they rose ... the wreckage of the 2008 crisis, 10 • THE COST OF CAPITALISM with the Great Moderation dead, policy makers, business leaders, and investors need to come to understand the insights of Hyman Minsky ... mortgage despite drop in value of house House Foreclosed upon 32 • THE COST OF CAPITALISM Minsky’s Insights on Debt and Risk There are two lessons from the saga of Hal and Hanna If things go...

Ngày tải lên: 20/06/2014, 20:20

... 34% NA Q4:2008 23% 30% 47% 90% Quarter: *Average Expectation: Federal Reserve Bank of Philadelphia, Survey of Professional Economists 68 • THE COST OF CAPITALISM 2007 Thus consensus forecasters ... commercial loan of ce 88 • THE COST OF CAPITALISM Over the mid-1980s, thrifts became major buyers of junk bonds They did so with little serious analysis of the underlying companies that offered up ... were offered a new product that would allow them to become bankers to mid-sized companies • 83 • 84 • THE COST OF CAPITALISM without creating large loan of ces Both innovations, on the face of...

Ngày tải lên: 20/06/2014, 20:20