Cost of Capital in Investment Decisions

Cost of Capital in Investment Decisions

Edouard de Mézerac

60,43 €
IVA incluido
Disponible
Editorial:
KS OmniScriptum Publishing
Año de edición:
2009
Materia
Gestión y técnicas de gestión
ISBN:
9783639161847
60,43 €
IVA incluido
Disponible

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'Which cost of capital should I use when valuing an investment?' The aim of this book is to provide an answer for corporate finance managers, industrial managers, MBA or finance students who have faced this very dilemma. Finance theory explicitly advocates that firms use a project-specific discount rate when valuing investment projects, or at least a rate specially tailored to each division within a multidivisional firm. Practitioners and scholars have designed a significant number of methods to compute such specific costs of capital ranging from high-flying approaches to very operational methods. And yet, in a recent survey of US firms, Graham and Harley (2001) showed that nearly 60% of responding companies said they use a single, company-wide discount rate to evaluate new investment projects. The yawning gap between corporate finance theory and in-company finance practices will be illustrated by a technical study of the varied approaches and an exploration of past and current business practices.

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