A business analyst at Mead is responsible for the calculation of the company’s cost of capital in each quarter and determine which variables are responsible for the change. A 10-year history of the cost of equity, cost of debt and weighted average cost of capital. The case invites a discussion of the geometric comparison arithmetic risk premia and long-term versus short-term risk-free rates as inputs into the CAPM. A student Lotus worksheet file on a computer disk for use with this c … Read more »

A business analyst at Mead is responsible for the calculation of the company’s cost of capital in each quarter and determine which variables are responsible for the change. A 10-year history of the cost of equity, cost of debt and weighted average cost of capital. The case invites a discussion of the geometric comparison arithmetic risk premia and long-term versus short-term risk-free rates as inputs into the CAPM. A student Lotus worksheet file on a computer disk for use with this case.

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Kenneth Eades

Source: Darden School of Business

13 pages.

Release Date: 04 October, 1991. Prod #: UV2299-PDF-ENG

Mead Corporation: Cost of Capital HBR case solution