Question: Calculating WACC Nike Corp. is considering producing Nike Cola, a soft drink for active lifestyles. Find the WACC appropriate for Nike to discount this investment.

Calculating WACC

Nike Corp. is considering producing "Nike Cola", a soft drink for active lifestyles. Find the WACC appropriate for Nike to discount this investment. $($ See the handout for additional instructions. $)$

$1 .$ Unlever Beta Financial Statement Data

Comparable Levered beta E D $/$ V Unlevered beta A PEP KO NKE

Pepsico Inc. D in Billions

Coca $-$ Cola Co $.$ E in Billions

AVERAGE beta A

$2 .$ Relever Beta

D $/$ V

Relevered beta E

$3 .$ Cost of Equity

Rp $6.70 %$

$4 .$ Cost of Debt

Bond rating A

$5 .$ WACC $($ KW $)$

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Calculation of WACC for Nike Corp To calculate the Weighted Average Cost of Capital WACC for Nike Corp we need the following information Cost of Equit... View full answer

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