In this video, Professor Linus Wilson calculates the weighted average cost of debt using FINRA data. Calculating the cost of debt is important for corporations making capital budgeting decisions as a key component of the company cost of capital as measured by the Weighted Average Cost of Capital (WACC). Finding a company’s cost of debt is important for business valuation.
FINRA stands for the Financial Industry Regulatory Authority.
Music by http://www.BenSound.com
We mentioned chapter 14 (Cost of Capital) in
Stephen A. Ross, Randolph W. Westerfield, and Bradford D. Jordan, 2013, Fundamentals of Corporate Finance: Alternate Edition, 10th ed., New York: McGraw-Hill Irwin, (ISBN: 978-0-07-747945-9).
This video does not represent the views of the University of Louisiana at Lafayette, FINRA, or the authors of Fundamentals of Corporate Finance. This is not investment advice.