Smart Finance

Term

WACC

Weighted average cost of capital: the average return a company's lenders and shareholders demand, weighted by how much each of them puts in. In a DCF it is the discount rate.

In pesos: If a stand is financed with $60,000 MXN from partners who expect 15% and $40,000 from a loan at 10%, its WACC, leaving taxes aside, is 13%.

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Educational content only: not financial, investment or tax advice. The numbers are examples to understand the idea, not a forecast or a recommendation.