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Tony is a sophisticated business person.Tony's stock broker advises him to buy 1000 shares of Q-Tel at the current market price of $10 per share.The broker's advice is based on a careful assessment of the market and Tony's advice to the broker about his risk tolerance.Tony takes the advice and directs his broker to buy the shares.The shares turn out to be a very bad investment and, after six months, are worthless.Tony has no claim against his broker.
Target Capital Structure
The mix of debt, equity, and other financing methods a company aims to use to fund its operations and growth.
Interest Rate
An interest rate is the percentage charged on the total amount you borrow or save. It's essentially the cost of borrowing money or the return on savings.
WACC
The calculation of a company's cost of capital, whereby each capital category is weighted according to its proportion, is referred to as the Weighted Average Cost of Capital.
Constant Dividend Growth Rate
The constant dividend growth rate is a model assuming that dividends from a stock or portfolio grow at a fixed, constant rate indefinitely.
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