杠杆企業的估價與資本預算講義(ppt 26頁)（英文版）

杠杆企業的估價與資本預算講義目錄：
1、Adjusted Present Value Approach
2、Flows to Equity Approach
3、Weighted Average Cost of Capital Method
4、A Comparison of the APV, FTE, and WACC Approaches
5、Capital Budgeting When the Discount Rate Must Be Estimated
6、APV Example
7、Beta and Leverage
8、Summary and Conclusions

杠杆企業的估價與資本預算講義內容提要：
Capital Budgeting When the Discount Rate Must Be Estimated
A scale-enhancing project is one where the project is similar to those of the existing firm.
In the real world, executives would make the assumption that the business risk of the non-scale-enhancing project would be about equal to the business risk of firms already in the business.
No exact formula exists for this. Some executives might select a discount rate slightly higher on the assumption that the new project is somewhat riskier since it is a new entrant.
APV Example:
Worldwide Trousers, Inc. is considering a $5 million expansion of their existing business. The initial expense will be depreciated straight-line over 5 years to zero salvage value; the pretax salvage value in year 5 will be $500,000. The project will generate pretax earnings of $1,500,000 per year, and not change the risk level of the firm. The firm can obtain a 5-year $3,000,000 loan at 12.5% to partially finance the project. If the project were financed with all equity, the cost of capital would be 18%. The corporate tax rate is 34%, and the risk-free rate is 4%. The project will require a $100,000 investment in net working capital. Calculate the APV.

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