Frozen Food Products: Cost of Capital Case Solution

Maria D’souza plans to expand its business by introducing a new line of frozen food products. She wanted to estimate the attractiveness of the new extension by estimating the net present value (NPV) of expected cash flows. His main concern was to find a suitable to be applied to the cash flows to determine the net present value of the discount rate of the project. D’Souza looking friend asked that the cost of capital for similar companies in the same industry is analyzed. The fundamental principle here is that companies in the same industry often have similar customers, operations and assets and, therefore, at risk of similar cases and have similar costs capital.
by
S. K. Mitra
Source: Ivey Publishing
6 pages.
Date Posted: November 22, 2012. Prod #: W12324-PDF-ENG
Frozen Food Products: Cost of the solution if capital

Frozen Food Products: Cost of Capital Case Solution
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