Weighted average cost of capital and capital structure

- [Instructor] Weighted Average Cost of Capital…and Capital Structure.…Another critical tool for corporate finance is WACC…or Weighted Average Cost of Capital.…Like project selection, you might have heard of WACC before,…but the reality is that WACC is a lot more crucial…and complex than many people assume initially.…I've talked to seasoned corporate finance executives…who still have questions about WACC…and how it applies to their business,…so it's crucial that you have…a really strong understanding of this…because it'll help you in your career moving forward…as your firm thinks about different types of projects…they wanna pursue.…

Now, when it comes to borrowing money,…people generally borrow money in a bank, right?…When you wanna buy a house or a car,…you generally go to a bank.…When you wanna buy a car,…maybe you go to a car dealership,…but then the car dealership gets the money from the bank.…Companies though have more options.…Sure, companies can rely on banks and many of them do…for credit lines, for term loans, revolvers,…