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Why is the after-tax cost of debt rather than the before-tax cost used to calculate the weighted average cost of capital?
Wiki User
∙ 15y ago
Because interest expense is deductible. Because interest expense is deductible.
Wiki User
∙ 15y ago
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A firm has an expected return on equity of 16 and an aftertax cost of debt of 8 What debtequity ratio should be used in order to keep the weighted average cost of capital at 12?
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How do I Calculate the weighted average fill rate?
multiply IFR for each stock item on an order weighted by the ordering frequency for the item
How do you calculate the atomic mass of an element containing a mixtures of isotopes?
weighted average of the various iisotopes
What is Weighted Average of Inventory Valuation Method?
Weighted average inventory valuation method is method in which inventory purchased at any price is put together to calculate one price for allocation in contrast to FIFO or LIFO.
Weighted average atomic mass?
What is weighted average atomic number
How do you calculate rainfall using the thiessen polygon method?
To calculate rainfall using the Thiessen polygon method, you first need to divide the area into polygons based on rain gauge locations. Then, calculate the area of influence of each rain gauge within its polygon. Finally, you can determine the weight of each rain gauge based on its influence area, which is used to calculate the average rainfall for the entire region.
Is The Dow Jones Industrial Average a market value weighted or price weighted index?
The Dow Jones Industrial average is a price weighted index.
What do you add to your unweighted average?
You can't convert an unweighted average into a weighted average simply by adding something. You have to do the whole calculation for the weighted average.
How weighted score does calculate?
A weighted average is a more accurate measurement of scores or investments that are of relative importance to each other. Identify the numbers to be used, identify the weights of each number, convert percentages to decimals, multiply each number by its weight, and add them together to get the weighted score.
How do you calculate a weighted average in Excel?
The easiest way is to use sumproduct in Excel. Sumproduct takes two (or more) lists of the same size and multiplies the corresponding values in each list; then adds the product. See related links for an easy to read tutorial on how to calculate weighted averages in Excel.
How do you calculate weighted grades?
Most of the time when you calculate an average you are calculating a weighted average without thinking too much about it. A weighted average of a group gives more weight to one in the group if it occurs more then once. For example; in a room full of people you have 3 ten yr olds, 5 eight yr olds and 1 six yr old. What is the average age of the group? To find a nonweighted average just add the three ages represented, without regard to how many, and divide by three; (10 + 8 + 6)/3 = 8. A weighted average takes into account how many of each age there are; (3x10 + 5x8 + 1x6)/9 = 8.4 . (notice you divide by total number of people not the number of ages represented as previously). You will also notice that the weighted average is the same thing as writing down each person's age and dividing by the number of people.
What is the difference between Average method vs weighted average method?
in weighted average method we assigns the weight to the averages while in average methods we dnt do this
