Question: Please put it into excel with the formulas WACC MODEL If you have built the model correctly, you will have a WACC of 8.2% given

Please put it into excel with the formulas

WACC MODEL

If you have built the model correctly, you will have a WACC of 8.2% given the following inputs:

  • number of bonds issued = 50,000
  • principal per bond = $1,000
  • coupon rate = 5.0%
  • Yield-to-Maturity = 10.0%
  • Dividend at year 0 = $3.55
  • Dividend Growth rate during years 1-10 = 5.5%
  • Dividend terminal growth rate = 2.2%
  • Beta of company = 1.2
  • Risk-free rate = 3.0%
  • Expected market return = 8.5%
  • Total shares of stock = 500,000
  • Tax rate = 35.0%

NPV MODEL

If you have built the model correctly, you will have a NPV of $488 and IRR of 8.6% given the following inputs:

  • Initial investment = $12,500
  • % loss of the initial investment from (years 1-5) = -0.5%
  • % gain on the initial investment (years 6-14) = 25.3%
  • expected return = WACC from WACC model above

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