What is weighted average cost of capital (WACC)? Formula of WACC
Weighted Average Cost of Capital (WACC) is the cost of capital calculated by an enterprise based on the proportion of types of capital used by the enterprise. What is WACC? Weighted Average Cost of Capital in English is Weighted Average Cost of Capital, abbreviated as WACC. The average cost of capital is the cost of capital calculated by an enterprise based on the proportion of types of capital used by an enterprise. Financing capital of the business includes: ordinary shares, preference shares, bonds, debt … Meaning of WACC Usually in real business operations, to meet the capital needs for the investment process, enterprises have to mobilize and use many different sources of funding and each funding source has different costs of capital. Therefore, it is necessary to determine the average cost of capital to make the right financial decisions. See also: What is Profit margin? Synthesize information about profit margins WACC formula WACC = (E/V) x K E + (D/V)...