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WACC Unlevered Levered Equity Beta 0

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WACC Unlevered Levered Equity Beta 0 Powered By Docstoc
					                                     Unlevered            Levered

Equity Beta                                         0.75 (find bond beta)
Risk free rate                                    4.86%              4.86%
Expected return on market                        11.86%             11.86%
Corporate tax rate (tc)                           40.0%              40.0%
re                                               10.11%            14.048%
rd (net cost of debt)                            5.850%             7.800%
debt/equity                                            0              1.705
Wdebt                                              0.000              0.630
Wequity                                            1.000              0.370

WACC (opportunity cost of capital)           10.110%                8.144%

Equity                                            1.760
Debt                                              3.000

                                                          Net cost of debt
Preatax cost of debt                          13.00%
Dobrynin 400 bottom                           13.00%                  7.80%
YTM BBB debt                                 10.894%                  6.54%
YTM BB debt                                  12.753%                  7.65%
Levered            Levered

(find bond beta) (find bond beta)
            4.86%           4.86%
           11.86%          11.86%
            40.0%           40.0%
         16.201%          14.300%
           6.536%          7.652%
             1.705           1.705
             0.630           0.630
             0.370           0.370

          8.462%             8.181%

				
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posted:10/13/2011
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