You have conducted an analysis of BigCo and have found that the firm is made up of two different divisions: Satellites RUs (a satellite launching service) and a bank. Projects A to G are all related to satellite launching technology. You have also examined the industry of each division and have found the following:

a. What is the appropriate discount rate for projects A to G? Describe your assumptions.
b. What will be the impact on the shareholder value of BigCo if the firm used 7 percent, the overall WACC, in the valuation of the satellite launching projects (A toG)?

  • CreatedFebruary 25, 2015
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