If You Like You Can Use The Ytm On A Bond Issue That Is Not Callable As The Pre

I need help please …

If you like, you can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company.

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As you recall, the formula for WACC is:

rWACC = (E/E+D) rE + D/(E+D) rD (1-TC)

The formula for the required return on a given equity investment is:

ri= rf + βi * (RMkt-rf)

RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 5% unless you can develop a better number.

rf is the risk free rate. The risk free rate is normally the yield on US Treasury securities such as a 10-year treasury. For this assignment, please use 3.5%.

You may assume a corporate tax rate of 40%.

Conplete areport that contains the following elements:

·      Your calculated WACC.

·      How data was used to calculate WACC. This would be the formula and the formula with your values substituted.

·      Sources for your data.

·      A discussion of how much confidence you have in your answer. What were the limiting assumptions that you made, if any?

Include a Microsoft® Excel® file showing your WACC calculations discussed above.

If You Like You Can Use The Ytm On A Bond Issue That Is Not Callable As The Pre

I need help please …

If you like, you can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company.

Connect with a professional writer in 5 simple steps

Please provide as many details about your writing struggle as possible

Academic level of your paper

Type of Paper

When is it due?

How many pages is this assigment?

As you recall, the formula for WACC is:

rWACC = (E/E+D) rE + D/(E+D) rD (1-TC)

The formula for the required return on a given equity investment is:

ri= rf + βi * (RMkt-rf)

RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 5% unless you can develop a better number.

rf is the risk free rate. The risk free rate is normally the yield on US Treasury securities such as a 10-year treasury. For this assignment, please use 3.5%.

You may assume a corporate tax rate of 40%.

Conplete areport that contains the following elements:

·      Your calculated WACC.

·      How data was used to calculate WACC. This would be the formula and the formula with your values substituted.

·      Sources for your data.

·      A discussion of how much confidence you have in your answer. What were the limiting assumptions that you made, if any?

Include a Microsoft® Excel® file showing your WACC calculations discussed above.