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What is Understanding Capital Structure Costs about?
Here are the steps to calculate the WACC for Nike using the CAPM method: 1. Calculate the cost of equity using CAPM: Risk-free rate (20-year Treasury bond): 5.74% Market risk premium: 5.90% Beta: 0.69 Cost of equity = 5.74% + 0.69(5.90%) = 9.811% 2. Calculate the cost of debt: Yield to maturity on Nike
- Author
- Fadhila Hanif
- Language
- EN