The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark.
Multiply the after-tax interest rate of your debt by the principal amount of your debt. The result will be the true annual dollar cost of your debt. For example, if your loan is for $100,000, your interest rate is 5 percent and your after-tax interest rate is 4 percent, $100,000 times 4 percent equals $4,000.
Theoretically, the cost of equity is approximated by the Capital Asset Pricing Model (CAPM) = Risk-free rate + (Companyâs Beta x Risk Premium). The firmâs overall cost of capital is based on the weighted average of these costs.For example, consider an enterprise with a capital structure consisting of 70% equity and 30% debt; its cost of equity is 10% and after-tax cost of debt is 7%. Therefore, its WACC would be (0.7 x 10%) + (0.3 x 7%) = 9.1%.heoretically, the cost of equity is approximated by the Capital Asset Pricing Model (CAPM) = Risk-free rate + (Companyâs Beta x Risk Premium). The firmâs overall cost of capital is based on the weighted average of these costs.