CAPM and WACC: Ballack Inc projects for next year
1. Ballack Inc. is a 100% equity-financed company (no debt or preferred stock). Its WACC equals its costs of common equity, their retained earnings will be sufficient to fund its capital budget in the foreseeable future. Their beta of 1.4 the risk-free rate of 6.0% and the market premium is 5.5%. What is their WACC? 2. The