Cost of Capital and Cost of Equity | Business Finance

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  • Опубликовано: 3 дек 2024

Комментарии • 145

  • @hobbyhuman9499
    @hobbyhuman9499 3 года назад +6

    Holy eff, my professor is impossible to understand. This saved my life! He jumped right into the formulae before even explaining the concepts!

  • @zihanzhang675
    @zihanzhang675 4 года назад +96

    12 hours away from taking my final exam. And I am still be here to learn the basics :)

    • @Tamara-ju3lh
      @Tamara-ju3lh 3 года назад +2

      I hope it went well!
      I'm studying for the CPA (business section exam) and find myself coming back to the basics as well.

    • @yusufmld18
      @yusufmld18 2 года назад +2

      well now me 1 hour away for my exam :D

    • @Axiom61
      @Axiom61 2 года назад +1

      24 hours for my final exam lol

    • @kevinsolieff9686
      @kevinsolieff9686 2 года назад

      @@Axiom61 FOR ME 12 HOURS AWAY FOR ME
      HAHAHH

    • @Axiom61
      @Axiom61 2 года назад

      @@kevinsolieff9686 Good luck on your exam, you will ace it 😄

  • @robertyoung406
    @robertyoung406 4 года назад +4

    I'm terrible with definitions so I keep forgetting that Re is the COST. The business must have a return greater than their Re value if they want to be profitable.
    Thanks for the straightforward video!!

  • @yasmeenn4332
    @yasmeenn4332 3 года назад +1

    Thankyouu!! My professor cant explain anything, and i was relying on myself to learn from a book, thankyou so much you make it easy

  • @3650days
    @3650days Год назад +1

    👍🏻👍🏻 thanks so much! 2:30 our cost is their return

  • @meryaltamirano8681
    @meryaltamirano8681 6 лет назад +3

    Good video ! I understand !!!
    Where Is your video about cost of debt?

  • @SEEpath-kt7jm
    @SEEpath-kt7jm 8 лет назад +4

    Thank you home boy.....Saved me 2 hours of pain.....appreciate the clear explanation :)

  • @xinghuiteng9920
    @xinghuiteng9920 8 лет назад +6

    this is the best video so fay I watched on Cost of Equity. Well done

  • @prem52000
    @prem52000 2 года назад +4

    Wonderful presentation. The only correction i find is the growth from 2010 to 2011 which was $2 to $8 results to 300% hence the average of 67.5% should be corrected to 100.83%.

    • @bobagorof
      @bobagorof Год назад

      I found this presentation pretty painful to watch.
      Repeating basic concepts and covering them really slowly, then bringing in a magic formula without explanation as to how it was derived, and plugging some numbers in without explaining why the resulting figure is important rather than, say, 1% less.
      A definitive statement that what is important about cost of equity is what you're using it for (not who gave it to you... which would include their expected return), again without explaining the reasoning behind it.
      Very poorly paced or explained, in my opinion.
      And that's not even mentioning the repeated mispronunciation of "debt".

  • @ninagaby6569
    @ninagaby6569 8 лет назад +6

    Thank you so much!! I had big trouble trying to understand and apply this concept, but you've made it so easy to understand! :D

  • @RogelizaOma
    @RogelizaOma Год назад

    Thank you for helping me understand the basics.

  • @shreepadpurkar9835
    @shreepadpurkar9835 5 лет назад +1

    Well explained , step by step in a simple manner. Thanks a lot .

    • @commerceandfinanceacademy
      @commerceandfinanceacademy 4 года назад

      1).ruclips.net/video/4aBjGlewHag/видео.html :- Cost of Equity for Dividend paying firms within 6 mins :)
      2).ruclips.net/video/vC_Le2T7MFc/видео.html :- Cost of Capital Introduction with brilliant PPT animation.

  • @giangbui6042
    @giangbui6042 4 месяца назад

    It's such a great lesson. Many thanks

  • @milaakdeniz6317
    @milaakdeniz6317 7 лет назад +1

    I like the way you teach. It depends on fundamental basics. Thank you.

  • @niki7159
    @niki7159 4 года назад

    This is very helpful. Simplicity is the best.

  • @구구구구국-m9z
    @구구구구국-m9z 7 лет назад

    This is the first video that made me understand. Thanks alot for kind explanations

  • @andread9362
    @andread9362 8 лет назад +2

    omg thank you! ur explanation is so good and clear.. the end bit on how to find the dividend growth is super helpful!😊

  • @iamawinner111
    @iamawinner111 4 месяца назад

    Enjoyed thoroughly 💖

  • @ntcuong01ct1
    @ntcuong01ct1 4 года назад +4

    Dear friends, I have a question: Could you explain the relationship between Capital structure and company value?. Thanks.

  • @hariharansekar6026
    @hariharansekar6026 4 года назад

    Amazing explanation

  • @AnikiSiari
    @AnikiSiari 8 лет назад +48

    Where has this been all semester long?!?!?!?!?! I'm studying for my final exams!!!

    • @ramyshaaban685
      @ramyshaaban685 6 лет назад +5

      summarizing the whole semester in 13 minutes :)

    • @Pages_Perfected
      @Pages_Perfected 4 года назад +1

      i'm in my first lesson and HELP

  • @jiaozhang6563
    @jiaozhang6563 8 лет назад +1

    Thank you very much. The explanation is so good and clear.

  • @gowris4484
    @gowris4484 5 лет назад

    Thanks and happy that I found this video - clear explanation of concept

  • @lisamhango4386
    @lisamhango4386 Год назад

    Well explained. Thank you

  • @roy12386
    @roy12386 Год назад +1

    super useful video thanks

  • @NayanDX9
    @NayanDX9 9 лет назад +15

    the video is well-informed :)

  • @littleoldme8030
    @littleoldme8030 8 лет назад +9

    I wish you were my professor :D

  • @EhsnSuri9
    @EhsnSuri9 3 года назад

    Which marker/pen is that? It writes so nicely

  • @yositasunintaboon4455
    @yositasunintaboon4455 4 года назад

    thank you so much for sharing this helpful video

  • @sarahshehata3267
    @sarahshehata3267 4 года назад

    greattttt ..where is the rest of this series plzzz

  • @gamingonly7679
    @gamingonly7679 8 лет назад +23

    The growth rate between 2011 and 2010 is 300%?? (2011-2010)/2010? or i am calculate at the wrong way

  • @ronaldyeo8277
    @ronaldyeo8277 Год назад

    This is a really great video. So just to clarify, D1 is the current dividend, which is $3 x 107%?

  • @manfredpurkarthofer7862
    @manfredpurkarthofer7862 5 лет назад

    Thanks for the genius art of explaining this topic!

    • @commerceandfinanceacademy
      @commerceandfinanceacademy 4 года назад

      1).ruclips.net/video/4aBjGlewHag/видео.html :- Cost of Equity for Dividend paying firms within 6 mins :)
      2).ruclips.net/video/vC_Le2T7MFc/видео.html :- Cost of Capital Introduction with brilliant PPT animation.

  • @BaiyerBull
    @BaiyerBull 6 лет назад

    the video has helped alot would you be able to do one about using the CAPM formula, will be much appreciated

  • @boiledpotato9826
    @boiledpotato9826 7 лет назад

    well informed and clear video. thanks.

  • @felixmaume5641
    @felixmaume5641 4 года назад

    outstanding......................

  • @kentheengineer592
    @kentheengineer592 Год назад

    1:12 a bit of a misunderstanding really allow me to explain ppl can be paid using deffered assets that can be leased in exchange for labor so

  • @Tino27sanyika
    @Tino27sanyika 4 года назад +1

    When watching this video I feel like I have graduated already. So excellent

  • @ReitumetseSethabane
    @ReitumetseSethabane 2 года назад

    Great video

  • @alexrfhk1634
    @alexrfhk1634 3 года назад +1

    I have a question on how to find ‘g’. From 2010 to 2011, there is 2 to 8 which should be 300% increase. Why it is 200%?

  • @davidndirangu4414
    @davidndirangu4414 3 года назад

    Thanks so much the growth factor was an issue

  • @SuperGrey95
    @SuperGrey95 8 лет назад

    Best explanation ever !!

  • @radhikagoel6268
    @radhikagoel6268 7 лет назад +2

    Hey where are other videos?

  • @tahmidkamal2203
    @tahmidkamal2203 5 лет назад

    Hi very effective vedio. What is the name of a book book for only to be expert easily on the topic " Cost of Capital " ??

  • @dalyasalama2506
    @dalyasalama2506 2 года назад

    hii there on the last part how did you calculate the value of g i couldnt understand

  • @gontsemokone64
    @gontsemokone64 Год назад

    get i get link for one where you use SML Approach to calcululate cost of capital

  • @nicholasseah8068
    @nicholasseah8068 3 года назад

    Beautiful, truly

  • @marymonika9920
    @marymonika9920 6 лет назад

    U just made my mind so clear about these both topics which I'm not able to understand in my whole semester thank uh ! My clg sucks

  • @بيانالفارسية
    @بيانالفارسية 3 года назад

    great content, keep it up!!

  • @TheZeroskull3
    @TheZeroskull3 8 лет назад

    very nice job ! helped me alot

  • @michaelsimmons5401
    @michaelsimmons5401 6 лет назад

    Thanks, excellent lesson!

  • @kentheengineer592
    @kentheengineer592 2 года назад

    actually you need to pay people but it doesn't have to be money, businesses prefer money because cash is usually a type of promissory note that has been secured thus it's called a security, if the issuer of money is unable to repay it's debts then based on litagation and corperate liability the assets will be used to discharge the debt and repay the creditor otherwise the creditor is at risk to take a Loss
    is based on certain types of promissory notes or types of bills of exchange that can be all traded for banknotes on demand by calling the BEP and making a deal with them

  • @dailyfuel5810
    @dailyfuel5810 5 лет назад

    Love u man from India ❤

  • @jyotiyadav2449
    @jyotiyadav2449 4 года назад

    Cost of convertible preference shares in wacc?

  • @palavvrushali4975
    @palavvrushali4975 7 лет назад

    any suggestion of a cost of capital

  • @thuscomeguerriero
    @thuscomeguerriero 7 лет назад

    Good penmanship!

  • @FireWorksInJuly
    @FireWorksInJuly 3 года назад

    I don’t understand how you calculated g at the end of the video to be 64% but in your example it was only 7%. Can you explain?

  • @alikaraca163
    @alikaraca163 Год назад

    Nice presentation but I gotta make some corrections. In your formula, P0 and D0 represent the same year, to the extent that I understand in your formula. if so, the share price's year and dividend of $3 last year mismatch in your question which is not correct. Because when you apply the growth model formula the share price you are finding is the current year. But, you are saying the current year is last year which is not.

  • @mrbrown2065
    @mrbrown2065 2 месяца назад

    Using quoted shares is easy but most people wants to calculate is the cost of capital for start up business

  • @monicarutanhira8896
    @monicarutanhira8896 6 лет назад

    so helpful...one of the best explanatons

  • @muhammadumerkhan7420
    @muhammadumerkhan7420 6 лет назад

    Very helpful

  • @chrisweber759
    @chrisweber759 6 лет назад

    If a company uses cash from it's retained earnings would that still count as equity and what would it's cost be?

  • @hashemeshanouq7351
    @hashemeshanouq7351 6 лет назад

    Well done

  • @josejade2152
    @josejade2152 2 года назад

    Yr 2010 to Yr 2011 the growth rate is 300% not 200% right? Correct me if im wrong.

  • @yamenomeira2158
    @yamenomeira2158 6 лет назад

    thank you very match thanks to your explanation

  • @kentheengineer592
    @kentheengineer592 2 года назад

    how to establish ownership of any thing before the project begins is what holds people back from starting a business

  • @kanishk2643
    @kanishk2643 7 лет назад

    What about new companies who don't have share in the market? How do you estimate the Po in the equation unless, there is some other method....?

    • @RahulSingh-os2cl
      @RahulSingh-os2cl 4 года назад

      Then, there will be no Equity. So, no need of Ke

  • @prabhjotkaur6729
    @prabhjotkaur6729 7 лет назад

    thank you so much this video helped me alot:)

  • @eltajbabazade1189
    @eltajbabazade1189 4 года назад

    Thank you 🙏

  • @deji2779
    @deji2779 6 лет назад

    How do you find the average?

  • @fresa5438
    @fresa5438 2 года назад

    mantap terimakasih (thank you)

  • @Thankyouobamabasedgod
    @Thankyouobamabasedgod 7 лет назад

    thanks for the help mate

  • @trevorkevinsweeney9099
    @trevorkevinsweeney9099 4 года назад +1

    My exam is in an hour I am going through this 😭😂😂😂 thank you

  • @meaya7
    @meaya7 7 лет назад

    thank you fpr spoon feeding me sir!

  • @ntcuong01ct1
    @ntcuong01ct1 4 года назад

    I have a question:
    cost of capital = net revenue * WACC, right?.

  • @renzeldiabo5889
    @renzeldiabo5889 3 года назад

    Where is the part 2

  • @NA-cx8of
    @NA-cx8of 7 лет назад

    Ok so I know my cost of equity is 15%. Do I compare it to Return on Equity or Return on Investment?

    • @chizomamangela847
      @chizomamangela847 4 года назад

      Thanks a lot sir. Your lecture was very useful to me on Do and D1

  • @komorebiii__7636
    @komorebiii__7636 8 лет назад

    thank you so much

    • @commerceandfinanceacademy
      @commerceandfinanceacademy 4 года назад

      1).ruclips.net/video/4aBjGlewHag/видео.html :- Cost of Equity for Dividend paying firms within 6 mins :)
      2).ruclips.net/video/vC_Le2T7MFc/видео.html :- Cost of Capital Introduction with brilliant PPT animation.

  • @HK-ri9bh
    @HK-ri9bh 3 года назад

    Thank youu

  • @akt2948
    @akt2948 5 лет назад

    Man are u always great like that 😁👍🏼

    • @commerceandfinanceacademy
      @commerceandfinanceacademy 4 года назад

      1).ruclips.net/video/4aBjGlewHag/видео.html :- Cost of Equity for Dividend paying firms within 6 mins :)
      2).ruclips.net/video/vC_Le2T7MFc/видео.html :- Cost of Capital Introduction with brilliant PPT animation.

  • @chunluo6033
    @chunluo6033 5 лет назад

    better than my teather

  • @khosi_leighlifestyle8846
    @khosi_leighlifestyle8846 3 года назад

    What does SML stands for?

    • @prem52000
      @prem52000 2 года назад

      The security market line

  • @leratolikhomo1649
    @leratolikhomo1649 7 лет назад

    I subscribed. Sir I like yoooouuuuuuuu.

  • @swathivadlamani7448
    @swathivadlamani7448 4 года назад

    I still wonder how you got 200%, 37.5 and 40%?

  • @anjaliiii689
    @anjaliiii689 5 лет назад +4

    B is silent in debt ... we call it det ..

  • @anjaliiii689
    @anjaliiii689 5 лет назад +4

    Are you Rob Stark??? Your accent is exactly like him .. i love your voice too !! Marry me

    • @mithleshgajar8621
      @mithleshgajar8621 5 лет назад

      This is happening too much.

    • @commerceandfinanceacademy
      @commerceandfinanceacademy 4 года назад

      1).ruclips.net/video/4aBjGlewHag/видео.html :- Cost of Equity for Dividend paying firms within 6 mins :)
      2).ruclips.net/video/vC_Le2T7MFc/видео.html :- Cost of Capital Introduction with brilliant PPT animation.

  • @Sky-pg6xy
    @Sky-pg6xy 3 года назад +1

    Why is 2$ to 8$ 200% and not 300%?

  • @alexandervoronin5323
    @alexandervoronin5323 4 года назад

    What happens if a company becomes so profitable it can repay all of its debt and buyback all of its equity?

  • @hold_it_dude
    @hold_it_dude 5 лет назад +1

    Does anyone find this guy's voice similar to Jesse Pinkman? Or is it just me?

  • @stfds7857
    @stfds7857 6 лет назад

    you were too cute m8, wish you used CAPM though because that's what i need help with zjzjsjsj

  • @romeshkirpalani848
    @romeshkirpalani848 5 лет назад

    2014 and still using calculator and paper...forget about equity or debt....there will be no growth man...

  • @dougzembiec9995
    @dougzembiec9995 8 лет назад

    growth rate is 51,83% BTW......

    • @shanebosch6403
      @shanebosch6403 8 лет назад

      Doug Zembiec no, he is correct. The growth was for three years, not four. It doesn't mean that because there's 4 years that you divide by 4, as 2010 was the base year in this example.

    • @MissIsabelleEwah
      @MissIsabelleEwah 6 лет назад

      he was wrong. He put 200 instead of 300% rise from year 2010-2011.

  • @Red_24X
    @Red_24X 8 лет назад +2

    thank you boy. . . :-)

  • @MEHBOOBZARGAR
    @MEHBOOBZARGAR 7 лет назад

    anyone here to solve a question??

  • @Pages_Perfected
    @Pages_Perfected 4 года назад

    HELP HELP HELP HELP

  • @padraigmoloney5952
    @padraigmoloney5952 8 лет назад

    Debt is pronounced like 'death'. You are pronouncing it like 'depth'.

  • @marymonika9920
    @marymonika9920 6 лет назад +1

    U just made my mind so clear about these both topics which I'm not able to understand in my whole semester thank uh ! My clg sucks

  • @nsadriana3153
    @nsadriana3153 5 лет назад

    Thank you so much

  • @23longbong
    @23longbong 3 года назад

    thank you a lot