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Investing Glossary:
Weighted average cost of capital (WACC)
Copyright 2009,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Term: |
| Weighted average cost of capital (WACC)
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| Definition: |
| Expected return On a Portfolio of all a firm`s securities. Used as a Hurdle rate for Capital investment. Often the weighted Average of the Cost of equity and the cost of Debt The weights are determined by the relative proportions of equity and debt in a firm`s capital structure.
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