Discount Rates

Marc C. Hübscher () and Björn Heidecke ()
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Marc C. Hübscher: Deloitte GmbH
Björn Heidecke: Deloitte GmbH

A chapter in Intangibles in the World of Transfer Pricing, 2021, pp 355-363 from Springer

Abstract: Abstract The discount rate is a crucial factor for valuing intangibles and needs to be considered in most of the approaches described. This chapter outlines how the discount rate can be calculated. In particular, it explains how the weighted cost of capital (“WACC”) is determined. WACC is typically applied when discounting cash flows with DCF models. The CAPM model is used to calculate the cost of equity, which along with the cost of debt is required to calculate the WACC.

Keywords: Discount rate; WACC; CAPM (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-319-73332-6_21

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DOI: 10.1007/978-3-319-73332-6_21

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