Identify traditional and modern techniques of raising capital. ➔ Discuss their pros and cons
➔ 2 WACC figures should be calculated based on two different methods of calculating ke.
➔ Each method, CAPM and DVM should be introduced and discussed using in–text citations.
➔ Kd should be introduced, calculated, explained and analysed. You should also refer to tax shield in your answer.
➔ The decision of which WACC will be utilised in investment appraisal techniques should be justified.
➔ You should be clearly commenting on where did you obtain rm, rf, g, beta and tax figures as well as your justifications on rm, rf, g figures. You should comment on what does your beta value from your proxy company tells you.
Above is for the Calculate an up–to–date estimate of the company’s cost of capital part. You
should also answer the second part of the question on the funding requirements.
➔ Identify traditional and modern techniques of raising capital.
➔ Discuss their pros and cons
➔ Explain why companies may choose one method over another.
➔ State what method you think is the most appropriate for CWIRE LTD and explain your reasoning in detail.