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I think sir in NPV lectures we not recover this WACC . BBP KIT Q 46
due co uses its after tax weighted average cost of capital when apraising investemnt project .It has cost of equity of 11% and a before tax cost of debt of 8.6% .Then long finance of the company ,on a market value basis , consist of 80% equity and 20 % debt..
Please i am confuse about this wat is this ?
If you want me to answer then in future you must ask in the Ask the Tutor Forum.
WACC is the weighted average cost of capital and is covered in full detail in the lectures on the cost of capital. The question as you have typed it is impossible to answer because you have not given the tax rate.
If you work through our lectures then they are a complete course covering everything you need to pass F9 well.
The formula is on the formula sheet.
However you must watch the lectures because you don’t need the formula and although it will work for this example, it will not work when there is redeemable debt.
Also, I wrote in my response before that you must ask in the Ask the Tutor Forum if you want me to answer. Despite that you have asked another question in this forum expected an answer from me!
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