Is WACC better high or low? A higher WACC indicates that a business is paying more to obtain its capital needs, which means that it will be earning less of a return on its investment. Therefore, a lower WACC is more attractive to potential investors because this means the return they will...
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For this reason, we will say that one capital structure is better than another if it results in...
a company may evaluate an investment in a new plant versus expanding an existing plant based on the IRR of each project. The higher the IRR the better the expected performance of the project and the more return the project can bring to the company. ...
The discount rate determined using this approach will be higher or lower than the weighted average cost of capital. It will be higher where the project is riskier and vice versa. It offers a better measurement of value added by a project....
If the company believes that a merger, for example, will generate a return higher than its cost of capital, then it's likely a good choice for the company. However, if it anticipates a return lower than its investors are expecting, there might be better uses for that capital. ...
This means that whether you’ve used up your total deductible in the past year or not, at the start of next year, the amount will restart to what is stated in the plan. To better comprehend what a deductible is and how it works, let’s take a look at an example. ...
lower, and the estimates are more stable The bottom-up beta may provide a better estimate of the true beta when the firm has reorganized or restructured itself substantially during the period of the regression Weight the division betas based on the current mix Division betas are required to...
with the TD-4 model, especially in the periods where extreme values of returns were presented, thus confirming that the four factors included in this model allow to better explain the returns of the TSOs in Colombia, by presenting a lower RMSE and a higher R2 as shown in the previous ...
with the TD-4 model, especially in the periods where extreme values of returns were presented, thus confirming that the four factors included in this model allow to better explain the returns of the TSOs in Colombia, by presenting a lower RMSE and a higher R2 as shown in the previous ...