Cost of capital Flashcards
(4 cards)
1
Q
What is the formula for the weighted average cost of capital (WACC)?
A
See formula sheet
2
Q
How is the cost of equity calculated using CAPM?
A
Re =Rf +β·(Rm −Rf)
3
Q
How do you compute the cost of debt
A
Rd = Rf + Credit Spread
4
Q
What is the formula for the unlevered cost of capital?
A
see formula sheet
