Discount Rate

متوسط التكلفة المرجح لرأس المال لدول مجلس التعاون الخليجي – مجموعة أدوات لممولي الشركات

Weighted Average Cost of Capital (WACC) assumes importance in corporate finance decision making. In the GCC, unlisted companies outnumber listed companies by miles and hence most of the deals involve unlisted companies in one way or other. Corporate finance professionals face twin problem while valuing an unlisted company. They have to estimate future cash flows and also estimate the appropriate “discount rate” at which these cash flows can be discounted to the present. Such a discount rate is nothing but...