Formula
WACC = (E/V)×Re + (D/V)×Rd×(1−T).
Use WACC to discount unlevered cash flows in enterprise DCF.
Key takeaways
- Tax shield reduces cost of debt
- Update WACC when leverage changes
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Apply these concepts with formula-based tools on Calculator Factory.
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FAQ
- Where does Re come from?
- Cost of equity often comes from CAPM or build-up methods — this calculator accepts your estimate.