a)
To determine: The
Introduction:
Net present value is the difference among the present value of
b)
To determine: The WACC and chances in WACC.
Introduction:
WACC (weighted average cost of capital) is the rate at which a firm is predicted to pay, on an average, to all the security holders in order to finance its assets.
Net present value is the difference among the present value of cash outflow and present value of cash inflow for a particular period of time.
c)
To determine: The net present value using WACC method.
Introduction:
WACC (weighted average cost of capital) is the rate at which a company is expected to pay, on an average, to all the security holders in order to finance its assets.
Net present value is the difference between the present value of cash outflow and present value of cash inflow over a specified period of time.
d)
To determine: The equity cost of capital and how it changes.
Introduction:
The unlevered cost of capital is an assessment using either an actual debt-free or hypothetical
e)
To determine: The equity cost of capital, how it changes, and compare the answer with part (a).
Introduction:
The unlevered cost of capital is an assessment using either an actual debt-free or hypothetical rate of return used to measure a firm’s cost to implement a particular capital project. The unlevered cost of capital must demonstrate that the project is less expensive than a levered cost of capital.
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