Cost of Capital Set, Contains: Cost of Capital book and Workbook - Hardcover

Pratt, Shannon P.

Hardcover

ISBN 10: 0471432512 ISBN 13: 9780471432517

Publisher: Wiley, 2002

Synopsis

"Cost of capital estimation has long been recognized as one of the most critical elements in business valuation, capital budgeting, feasibility studies, and corporate finance decisions and is also the most difficult procedure to assess and perform. Now in its fourth edition, Cost of Capital: Applications and Examples addresses the most controversial issues and problems in estimating the cost of capital." "Renowned valuation experts and authors Shannon Pratt and Roger Grabowski present both the theoretical development of cost of capital estimation and its practical application to valuation, capital budgeting, and forecasting of expected investment returns encountered in current practice. In this learning text/handy reference, Pratt and Grabowski deftly review and explore the theory of what drives the cost of capital, the models currently in use to estimate cost of capital, and the data available as inputs to the models to estimate cost of capital." "In this thoroughly updated and comprehensive fourth edition, Cost of Capital summarizes the results and practical implications of the latest research--much of which is gleaned from unpublished academic working papers--and includes scores of formulas and elucidating examples throughout to enhance readers' insights." "The landmark book corporate treasurers, business appraisers, CPAs, and valuation experts have come to rely on, Cost of Capital lays out the basic tools to use immediately when estimating cost of capital or when reviewing an estimate. This dynamic author team also analyzes criticism of major models for developing estimates of the cost of capital in use today, and also presents procedures for a number of alternative models." "This definitive text is an indispensable reference tool for professional valuation practitioners as well as attorneys and judges, investment bankers, CFOs, academicians and students, and CPAs."--BOOK JACKET.

About this title

From the Publisher

Cost of capital refers to the cost of borrowing money for the purpose of raising funds and the effect of that acquired debt on shareholder's or owner's equity. This book develops a more defined method of calculating the true cost of capital with regard to equity valuation.

From the Inside Flap

Cost of capital estimation has long been recognized as the most critical element in business valuation, capital budgeting, feasibility studies, and corporate finance decisions. It is also the most difficult procedure to perform and assess. In Cost of Capital: Estimation and Applications, renowned author and valuation expert Shannon Pratt addresses the most controversial issues and thorny problems in estimating the cost of capital. In a clear, concise, and easily understandable manner, he tackles all of the problems in calculating rates of return, and offers sensible, well-thought-out solutions that apply to small business and midsize companies as well as multibillion-dollar corporations. Dr. Pratt lays out the basic tools that anyone can use immediately when estimating cost of capital or reviewing someone else s estimate. He presents basic theory and explains how it is used in valuation of businesses and business assets, as well as in capital expenditure decision making; and he provides clear explanations for each of the mathematical formulas used. Citing comprehensive sources of information, Pratt also offers clear and complete definitions of all common terminology used in cost of capital estimation. He points out the errors that are common to the process and gives practical advice on how to avoid them when making an estimation and identify them in other people s work. This remarkable book:

• Describes the development of discount and capitalization rates
• Offers in-depth coverage of valuation and corporate finance applications
• Provides needed data for borrowing money
• Supplies user-friendly models for applications in all contexts

Cost of Capital combines a state-of-the-art treatise on cost of capital estimation with an accessible introduction for the nonprofessional. It begins with an exposition of basic concepts understandable to the layman and proceeds gradually from simple applications to the more complex procedures commonly found in the marketplace. Generously supplemented with tables, graphical diagrams, and step-by-step examples, this book is an indispensable resource for business appraisers, valuation professionals, consultants attached to accounting firms, and executives who must make important decisions based on their understanding of cost of capital estimations.

Edition details

• Publisher: Wiley
• Publication date: 2002
• ISBN 10: 0471432512
• ISBN 13: 9780471432517
• Binding: Hardcover
• Language: English
• Edition number: 1
• Number of pages: 520