COMM 308 Chapter 20: Comm 308 - Chapter 20 - Cost of Capital - Lecture Notes
21 Sep 2018
School
Department
Course
Professor
Document Summary
Comm 308 - introduction to corporate finance - lecture notes. 20. 1 explain how the three major problem areas in nance: valuation, cost of capital, and determining cash ows are related. 20. 2 calculate the weighted average cost of capital and explain its signi cance. 20. 3 estimate the cost of capital and its non-equity components. 20. 4 explain how operating and nancial leverage a ect a rm"s risk. 20. 5 apply the discounted cash ow model to estimate the equity cost and describe its advantages and disadvantages - no fed model. 20. 6 estimate the cost of equity using risk-based models and describe the advantages and limitations of these models. 20. 7 explain how the wacc interacts with the investment decision framework introduced in chapters 13 to 17. 20. 2 the cost of capital: the overall market value of the rm is the market value of its debt, preferred equity and common equity sources of.
