Glossary
With over 200 terms in both English and French, our M&A Dictionary is designed to help you better understand the key words and concepts related to the sale oe purchase of a business in Canada.
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Weighted Average Cost of Capital (WACC)
« Back to Glossary IndexCategory: Business Valuation
The Weighted Average Cost of Capital (WACC) is a comprehensive metric representing the average cost of a company’s financing sources, considering both debt and equity. Calculated by assigning weights to the cost of each component based on its proportion in the capital structure, WACC serves as a benchmark discount rate for evaluating the present value of future cash flows in investment projects. It reflects the blended cost of capital and aids in determining the minimum rate of return required for a project to be deemed financially viable, guiding investment decisions and corporate finance strategies.
« Back to Glossary IndexAcronym:
WACC
French Translation: