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anonymous

  • 5 years ago

Aswath: Why do you use a cumulative WACC in your 3-stage FCFF model?

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  1. anonymous
    • 5 years ago
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    If your cost of capital changes over time, you have to look at the cumulated cost of capital. A year-specific cost of capital is like a forward rate for that year...

  2. anonymous
    • 5 years ago
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    That makes sense. Thank You

  3. anonymous
    • 5 years ago
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    I do have one question: What exactly do you mean by a forward rate for that year? In regards to the year-specific cost of capital

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