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Procter & Gamble: Cost of Capital

Eades, Kenneth M.

Case

Procter & Gamble: Cost of Capital

Eades, Kenneth M.

F-0931 | Published March 29, 1990 | 16 pages Case

Collection: Darden School of Business

Product Details

To assess whether a company should enter the household-products market, Procter and Gamble's weighted-average cost of capital is computed. Clorox's cost of capital is also computed as a check on the P&G estimate. The case emphasizes the conceptual as well as mechanical aspects of computing cost of capital for a company with homogeneous business risk and stable capital structure.

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