Find a copy online
Links to this item
Find a copy in the library
Finding libraries that hold this item...
|Additional Physical Format:||Print version:
Pratt, Shannon P.
Cost of Capital.
Hoboken, New Jersey : Wiley, ©2014
|Material Type:||Document, Internet resource|
|Document Type:||Internet Resource, Computer File|
|All Authors / Contributors:||
Shannon P Pratt; Roger J Grabowski
|ISBN:||9781118852804 111885280X 9781118846780 1118846788|
|Notes:||Part Two: Estimating the Cost of Equity Capital.|
|Description:||1 online resource (xxxii, 1312 pages).|
|Contents:||Cost of Capital: Applications and Examples; Contents; About the Authors; Foreword; Preface; Acknowledgments; Part One: Cost of Capital Basics; Chapter 1: Defining Cost of Capital; Introduction; Components of a Capital Structure; Cost of Capital Is a Function of the Investment; Cost of Capital Is Forward-looking; Cost of Capital Is Based on Market Value; Cost of Capital Is Usually Stated in Nominal Terms; Cost of Capital Equals the Discount Rate; Discount Rate Is Not the Same as Capitalization Rate; Standard (Basis) of Value; Summary. Chapter 2: Introduction to Cost of Capital Applications: Valuation, Project Selection, and RatemakingIntroduction; Net Cash Flow Is the Preferred Economic Income Measure; Cost of Capital Is the Proper Discount Rate; Present Value Formula; Example: Valuing a Bond; Applications to Businesses, Business Interests, and Capital Budgeting Projects; Applications in Ratemaking; Summary; Chapter 3: Net Cash Flow: The Preferred Measure of Economic Income; Introduction; Defining Net Cash Flow; Net Cash Flow to Common Equity Capital; Net Cash Flow to Invested Capital. Net Cash Flows Should Be Probability-weighted Expected ValuesWhy Net Cash Flow Is the Preferred Measure of Economic Income; Summary; Additional Reading; Appendix 3A: Alternative Measures of Economic Income; Introduction; Capital Cash Flow; Adjusted Present Value; Residua l Income; Chapter 4: Discounting versus Capitalizing; Introduction; Capitalization Formula; Example: Valuing a Preferred Stock; Functional Relationship between Discount Rate and Capitalization Rate; Major Difference between Discounting and Capitalizing; Constant Growth or Gordon Growth Model. Criticisms of the Gordon Growth ModelCombining Discounting and Capitalizing; Two-stage Model; Three-stage Model; Three-stage Model with Gradual Change in Growth; Equivalency of Discounting and Capitalizing Models; Summary; Appendix 4A: Equivalency of Capitalizing Residual Income; Chapter 5: Discounting-Beyond the Basics; Introduction; Midyear Convention; Midyear Discounting Convention; Midyear Capitalization Convention; Midyear Convention in the Two-stage Model; Seasonal Businesses; Matching Projection Periods to Financial Statement Dates: Partial First Year; Changing Risk over Time. Midyear Convention in Two-stage Model with Changing RiskDuration of an Investment; Summary; Chapter 6: Relationship between Risk and the Cost of Capital; Introduction; Defining Risk; How Risk Affects the Cost of Capital; Valuation of Risky Net Cash Flows; Risk Aversion versus Risk Neutrality; Market Returns Increase as Risk Increases by Asset Class; Types of Risk; Maturity Risk; Market Risk; Company-specific Risk; Liquidity and Marketability Risk; Measuring Riskiness of Net Cash Flows; ASC 820 Fair Value Measurement: Cash Flows and Present Value Discount Rates; Summary.|
|Series Title:||Wiley finance series.|
|Responsibility:||Shannon P. Pratt, Roger J. Grabowski.|
- Private companies -- Valuation.
- Capital investments.
- Business enterprises -- Valuation -- Law and legislation -- United States.
- Business enterprises -- Valuation.
- Capital investments -- Law and legislation -- United States.
- BUSINESS & ECONOMICS -- Industrial Management.
- BUSINESS & ECONOMICS -- Management.
- BUSINESS & ECONOMICS -- Management Science.
- BUSINESS & ECONOMICS -- Organizational Behavior.