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Homework answers / question archive / What's the WACC? What's the formula for determining the weighted average cost of capital? Discuss how to calculate or find each variable
What's the WACC? What's the formula for determining the weighted average cost of capital? Discuss how to calculate or find each variable. (For example, "The return on debt can be measured on the firm's long-term bonds," and so on.) Discuss both methods of determining the cost of equity. by the Finally, how can making changes to the capital structure maximize the value of the firm? (Hint: How does the capital structure relate to the WACC, and how does the WACC relate to the discount rate used in a net present value (NPV) computation?)
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