Cost Of Equity tweets
Flow to Equity- discount the cashflow from the project to equity holder of the leveraged firm at the cost of leveraged equity.
11 years ago
@Hamdaww ni finish I understood because the first firm is unlevered and there is no B/S ratio nor debt so the cost of equity will be R0
11 years ago
@D_HamiDy oh yea, when the firm is unlevered (no debt) cost of equity is the same as wacc (cost of capital)
http://twitter.com/FatmaHashim_
11 years ago
@FatmaHashim_ in the handout the have written that cost of equity is 10% but part b says find Rs :s and we used the 10% as R0
11 years ago
@D_HamiDy what I know is cost of equity is Rs & cost of capital is R0 which could be wacc
http://twitter.com/FatmaHashim_
11 years ago