Equity

3 The cost of Equity Capital represents the expected return of equity investors. The WACC is measured by taking the weight of debt outstanding and multiplying it by the cost of debt and the tax shield, then adding to that the weight of equity and multiplying that by the cost of equity, as shown in the following equation: Equation 1: [D/V*(Rd)*(1-T)+E/B*(Rd)] As the WACC holds true, the increased weight…

maxims; equity is equality and equity follows the law. The operation of these maxims sheds further light on the rationale for the HCA’s conclusions and, more broadly, helps to explain the nature of equity. The doctrine of contribution reflects the ‘natural justice’ that equity seeks to provide, by ensuring that parties sharing common obligations contribute proportionally to the fulfilment of that obligation. Thus, the doctrine of contribution is intrinsically linked with the maxim ‘equity is…

55% of total assets and the equity multiplier to be less than 2.7 times by June 30, 2012" (Pacific Grove Spice Company Case, p. 3). Currently, Pacific Grove has a total debt of $37.172 million, equal to 62% of total assets and 216% of owners' equity. Concurrently, Peterson and Hodges (CFO) are evaluating three opportunities. First, Pacific Grove should accept an offer from a cable cooking network to produce and sponsor a new program. Second, it should raise new equity capital by selling shares…

Both refinance home mortgage loan and home equity loan allows cashing out the equity in a property. However, they are different type of loans, serving different needs. Refinance mortgage is used to replace the existing mortgage with a new and improved loan. The purpose of refinance mortgage loan is mainly to lower the interest rates and the monthly payments on a mortgage. During the process of mortgage switch with refinance, providing there is equity in the property, some cash may be taken out…

investment risk of a company. This is due to an increase on the rate of return on equity and beta. Companies use WACC to evaluate new projects. By discounting potential investments by the WACC, we can determine if the potential project or investment will have a high enough return to satisfy the various investors. The asset beta method is another widely used tool for valuing the future projects…

Brand equity can be a strategic tool to survive in the highly competitive global world. Willingness to invest in socially responsible activities is not a cost or constraint for the company, but a source of competitive advantage (Yoo, 2015). Effective use of corporate…

“Why does social equity necessarily have two faces—civil rights and economic rights? Why has the American welfare state evolved as a pragmatic, not an ideological, solution to the pressing problem of social equity?” Social equity focus on fairness, justice, and equality usage of the community resources; Over the years the federal government has evolved into the world’s largest insurance business according to the case study, “Social Equity Through Social Insurance.” Currently, more than 60% of…

How well a nations establishes equity and justice to its citizens can be determined by several factors. One good indicator is the strength of the countries welfare state or the level of GDP such countries. However the authors Pat Armstrong, Hugh Armstrong and Tamara Daly wrote an article, “The thin blue line: Long-term care as an indicator of equity in welfare states” which argues a good indicator of equity and fairness in a society can be measured by the level of states commitment in long-term…

picture of research on criminal equity in Canada factored on crime and race. The idea of race in Canada and contextualizes the racial grouping plans used in the nation discussed. There is also the continuous civil argument over the accumulation and dispersal of racial information inside of the Canadian criminal equity framework and gives a diagram of as…

listed on the ASX. The three different companies were chosen to find out whether which company is doing its best by making profit and which is doing the least by being in loss as well as determining the market capitalisation and comparing it with its equity. This is done by breaking the financial statement into ratios. By breaking the financial statement into ratios, it will be determined where the business is doing its best, which should be increased and where it is not doing very well to limit…