Represents the weighted average cost of capital (WACC). Offers a WACC calculation, although it was intentionally designed to mislead students. Thus, their task is to identify and explain which are to be marked “error” in the analysis, which are intended to conceptual issues, the WACC and its components. Such questions are often misunderstood by students. Assuming that the students have to WACC, CAPM, the dividend discount model, and exposed the earnings capitalization model.

Represents the weighted average cost of capital (WACC). Offers a WACC calculation, although it was intentionally designed to mislead students. Thus, their task is to identify and explain which are to be marked “error” in the analysis, which are intended to conceptual issues, the WACC and its components. Such questions are often misunderstood by students. Assuming that the students have to WACC, CAPM, the dividend discount model, and the results of capitalization model has been exposed.
This is a Darden case study.
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from
Robert F. Bruner,
Jessica Chan
Source: Darden School of Business
8 pages.
Publication Date: Oct 10, 2001. Prod #: UV0010-PDF-ENG
Nike, Inc.: Cost of Capital (v. 1.8) HBR case solution