A COMPARISON OF ALTERNATIVE NET PRESENT VALUE FORMULATIONS - IMPLICATIONS FOR DEBT CAPACITY

John R. Fiske

No 278597, 1985 Annual Meeting, August 4-7, Ames, Iowa from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Two widely-used net present value formulas, the weighted average cost of capital formula and the return to equity formula are reconciled for both a single period and a multiperiod case. In both cases, the differences in NPVs emerging from the two formulas can be attributed to alternative assumptions about debt capacity.

Keywords: Agricultural Finance; Demand and Price Analysis (search for similar items in EconPapers)
Pages: 14
Date: 1985-08
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea85:278597

DOI: 10.22004/ag.econ.278597

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