WACC has two sides to its formula, Cost of Equity and Cost of Debt. The best way to calculate the Cost of Equity is the CAPM model or Capital Asset Pricing Model.
CAPM model includes the risk-free rate, beta, and market risk premium. In this video, we will explain how to calculate the Cost of Equity which is the expected return for investors.
Watch the entire course on our KZfaq channel / businessbasicsessentials
This is the 6th of 11 videos that teach Business Finance in Section 6 and is a good starting point if you are new to Finance or need a refresher.
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