The writer is very fast, professional and responded to the review request fast also. Thank you.
The cost of equity is built on the three factors the risk-free rate, the market risk premium and a company-specific risk adjustment The most commonly used model for this estimate is the capital asset pricing model (CAPM) To determine the CAPM we need to estimate a risk-free rate the market risk premium and the market beta
b. To determine Henkel’s corporate beta, unlever (and relever) the ordinary least squares (OLS) market betas for each company in the European Household and Personal Care segment, Prices can be found on the ‘Prices” tab of the ‘Select Market Data- spreadsheet. To determine the OLS market beta, regress 10-year monthly returns against the MSCI World index denominated in the same currency. In Excel, this can be done using the ‘SLOPE’ formula. Next unlever the market beta using each company’s year-end debt-to-equity ratio and the formula bu = be/1(+D/E). To determine Henkel’s corporate beta relever the average industry beta using Henkels year-end debt – to equity ratio. Repeat this process for each of Henkel’s divisions
c. Assume the market risk premium equals 5 percent
Show more
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more