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Dear Sir,
Your lectures are amazing and makes syllabus really easy…
We can calculate project specific cost of capital using CAPM etc..
But going through my text book I came across Marginal WACC which also states that Marginal WACC can be used to calculate project cost of capital…. I just want to make sure that Marginal WACC understanding is not required for the exam?
Regards
Thank you for your comment 🙂
No it cannot be asked. You obviously must be able to calculate the normal WACC and also (if asked for) the project specific cost of capital. But that is all.
(The book should not anyway have called it the marginal WACC – it is called the marginal cost of capital (the extra cost of capital)! But regardless, you cannot be asked to calculate it, not even when you come to P4 🙂 )
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