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sir one of the assumption for wacc is that it should not be project specific does that mean the finance was raised solely for that project? or is it something else can you describe it please thanks
I do not state that as an assumption, so I don’t know where you read it.
It is not an assumption of the WACC.
An assumption when we use the WACC to appraise is that it is not going to change due to the new project (i.e. is not project specific).
It says the finance is not project specific.
sir can you also explain this line it is therefore not the marginal cost of the additional finance but the overall average cost of all finance raised that is required for project appraisal.
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