Principles of Finance: Capital Structure and Cost of Capital

This lecture covers topics related to capital structure decisions, including the use of predetermined debt levels, the Weighted Average Cost of Capital (WACC) method, leverage, and the cost of capital. It also discusses the implications of maintaining a target leverage ratio, the importance of predetermined debt schedules, and the valuation methods such as the Adjusted Present Value (APV) approach. Additionally, it explores the estimation of betas for new business lines, the significance of bottom-up betas, and project-based cost of capital considerations.