Formula Sheet

Introduction to Corporate Finance

A = L + SE 𝐼𝐼𝐼𝐼𝐼𝐼(𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸) =
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸
𝐼𝐼𝐼𝐼

MVE = SO × MPS 𝑇𝑇𝑇𝑇

𝐷𝐷𝐷𝐷 =
𝑇𝑇𝑇𝑇
𝑀𝑀𝑀𝑀𝑀𝑀
𝑀𝑀𝑀𝑀 = 𝑇𝑇𝑇𝑇
𝐵𝐵𝐵𝐵𝐵𝐵
𝐷𝐷𝐷𝐷𝐷𝐷 =
𝑇𝑇𝑇𝑇+𝑇𝑇𝑇𝑇
EV = MVE + D – C
𝑁𝑁𝑁𝑁
𝐷𝐷𝐷𝐷𝐷𝐷𝐷𝐷 =
𝑁𝑁𝑁𝑁 𝐸𝐸𝐸𝐸
𝐸𝐸𝐸𝐸𝐸𝐸 =
𝑆𝑆𝑆𝑆
𝑇𝑇𝑇𝑇
𝐵𝐵𝐵𝐵𝐵𝐵 =
𝐵𝐵𝐵𝐵𝐵𝐵
RE = NI – Div
𝐸𝐸𝐸𝐸
CSE = NI – Div + SS – RS 𝑀𝑀𝑀𝑀𝑀𝑀 =
𝑀𝑀𝑀𝑀𝑀𝑀

𝑀𝑀𝑀𝑀𝑀𝑀
EBITDA = EBIT + D + A 𝑃𝑃𝑃𝑃 =
𝑁𝑁𝑁𝑁

ND = TD – ECSTI 𝑀𝑀𝑀𝑀𝑀𝑀
𝑃𝑃𝑃𝑃 =
𝐸𝐸𝐸𝐸𝐸𝐸
𝐺𝐺𝐺𝐺
𝐺𝐺𝐺𝐺 = 𝐸𝐸𝐸𝐸 𝐸𝐸𝐸𝐸 𝐸𝐸𝐸𝐸
𝑆𝑆
𝐸𝐸𝐸𝐸𝐸𝐸 = 𝑜𝑜𝑜𝑜 𝑜𝑜𝑜𝑜
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸 𝐸𝐸𝐸𝐸𝐼𝐼𝐼𝐼𝐼𝐼𝐼𝐼 𝑆𝑆
𝑂𝑂𝑂𝑂
𝑂𝑂𝑂𝑂 = 𝑁𝑁𝑁𝑁
𝑆𝑆
𝑅𝑅𝑅𝑅𝑅𝑅 =
𝐵𝐵𝐵𝐵𝐵𝐵
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸 = 𝑁𝑁𝑁𝑁+𝐼𝐼𝐼𝐼
𝑆𝑆
𝑅𝑅𝑅𝑅𝑅𝑅 =
𝑇𝑇𝑇𝑇
𝑁𝑁𝑁𝑁
𝑁𝑁𝑁𝑁𝑁𝑁 = 𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸(1−𝑇𝑇𝐶𝐶 )
𝑆𝑆
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 = 𝐵𝐵𝐵𝐵𝐵𝐵+𝑁𝑁𝑁𝑁
𝐶𝐶𝐶𝐶
𝐶𝐶𝐶𝐶 = 𝑁𝑁𝑁𝑁 𝑆𝑆 𝑇𝑇𝑇𝑇
𝐶𝐶𝐶𝐶
𝑅𝑅𝑅𝑅𝑅𝑅 = × ×
𝑆𝑆 𝑇𝑇𝑇𝑇 𝐵𝐵𝐵𝐵𝐵𝐵
𝐶𝐶+𝑆𝑆𝑆𝑆𝑆𝑆+𝐴𝐴𝐴𝐴
𝑄𝑄𝑄𝑄 = 𝑆𝑆
𝐶𝐶𝐶𝐶
𝐴𝐴𝐴𝐴 =
𝑇𝑇𝑇𝑇
𝐶𝐶
𝐶𝐶𝐶𝐶𝐶𝐶ℎ𝑅𝑅 =
𝐶𝐶𝐶𝐶 V1 = C0(1+r)
𝐴𝐴𝐴𝐴
𝐴𝐴𝐴𝐴𝐴𝐴 = 1 𝐶𝐶
𝑉𝑉0 = (1+𝑟𝑟)
𝐴𝐴𝐴𝐴𝐴𝐴

𝐴𝐴𝐴𝐴
𝐴𝐴𝐴𝐴𝐴𝐴 = NPV = PV(CF)
𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴

𝐼𝐼𝐼𝐼 =
𝐼𝐼 Price(A+B) = Price(A) + Price(B)
𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴
𝐸𝐸(𝐺𝐺)
𝐼𝐼𝐼𝐼 =
𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝐸𝐸 (𝑅𝑅) = 𝐼𝐼𝐼𝐼
𝐼𝐼

𝐴𝐴𝐴𝐴 Vn = C0 ×(1+r)n
𝐴𝐴𝐴𝐴𝐴𝐴 =
𝐴𝐴𝐴𝐴
1 𝑛𝑛 𝐶𝐶
𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝑉𝑉0 = 𝐶𝐶𝑛𝑛 � � = (1+𝑟𝑟)𝑛𝑛
𝐴𝐴𝐴𝐴𝐴𝐴 = 1+𝑟𝑟
𝐴𝐴𝐴𝐴
1 2 𝐶𝐶 𝑁𝑁 𝐶𝐶 𝐶𝐶
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸 𝑉𝑉0 = 𝐶𝐶0 + (1+𝑟𝑟) + (1+𝑟𝑟) 2 + ⋯ + (1+𝑟𝑟)𝑁𝑁
𝐼𝐼𝐼𝐼𝐼𝐼(𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸) =
𝐼𝐼𝐼𝐼

Page 1 of 4
 Introduction to Corporate Finance Formula Sheet (cont)

𝐶𝐶
𝑉𝑉0 = ∑𝑁𝑁 𝑛𝑛
𝑛𝑛=0 (1+𝑟𝑟)𝑛𝑛
𝐸𝐸 (𝐶𝐶𝐶𝐶 ) = ∑ 𝑝𝑝 × 𝐶𝐶𝐶𝐶
𝑁𝑁𝑁𝑁𝑁𝑁
𝑃𝑃𝑃𝑃 =
𝑅𝑅𝑅𝑅
𝐶𝐶1
𝑉𝑉0 =
𝑟𝑟 𝑈𝑈𝑈𝑈𝑈𝑈 = 𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸 × (1 − 𝜏𝜏𝑐𝑐 ) = (𝑅𝑅 − 𝐸𝐸 − 𝐷𝐷)(1 − 𝜏𝜏𝑐𝑐 )
𝐶𝐶 𝐶𝐶 1 𝑁𝑁 𝐶𝐶 1 𝑁𝑁
𝑉𝑉0 = − � � = �1 − � � �
𝑟𝑟 𝑟𝑟 1+𝑟𝑟 𝑟𝑟 1+𝑟𝑟

𝐶𝐶
𝑉𝑉𝑁𝑁 = ((1 + 𝑟𝑟)𝑁𝑁 − 1)
𝑟𝑟

1𝐶𝐶
𝑉𝑉0 = 𝑟𝑟−𝑔𝑔

𝐶𝐶 1+𝑔𝑔 𝑁𝑁
𝑉𝑉0 = �1 − � � �
𝑟𝑟−𝑔𝑔 1+𝑟𝑟

𝐶𝐶
𝑉𝑉𝑡𝑡 = ((1 + 𝑟𝑟)𝑁𝑁 − (1 + 𝑔𝑔)𝑁𝑁 )
𝑟𝑟−𝑔𝑔

𝑟𝑟(𝑡𝑡) = (1 + 𝑟𝑟)𝑛𝑛 − 1
𝐴𝐴𝐴𝐴𝐴𝐴
𝑟𝑟(𝑡𝑡) =
𝑘𝑘

𝑟𝑟−𝑖𝑖
𝑟𝑟𝑟𝑟 = FCF = UNI + D – CE - ∆NWC
1+𝑖𝑖

𝐶𝐶 NWC = CA – CL = C + AR + I – AP
𝑉𝑉0 = (1+𝑟𝑟𝑛𝑛 )𝑛𝑛
𝑛𝑛
𝐹𝐹𝐹𝐹𝐹𝐹 = (𝑅𝑅 − 𝐸𝐸 − 𝐷𝐷) × (1 − 𝜏𝜏𝑐𝑐 ) + 𝐷𝐷 − 𝐶𝐶𝐶𝐶 − ∆𝑁𝑁𝑁𝑁𝑁𝑁
𝐶𝐶 𝐶𝐶 𝐶𝐶
𝑉𝑉0 = 𝐶𝐶0 + (1+𝑟𝑟1 ) + (1+𝑟𝑟2 )2 + ⋯ + (1+𝑟𝑟𝑁𝑁 )𝑁𝑁
1 2 𝑁𝑁 𝐹𝐹𝐹𝐹𝐹𝐹 = (𝑅𝑅 − 𝐸𝐸 ) × (1 − 𝜏𝜏𝑐𝑐 ) − 𝐶𝐶𝐶𝐶 − ∆𝑁𝑁𝑁𝑁𝑁𝑁 + 𝜏𝜏𝑐𝑐 × 𝐷𝐷
𝐶𝐶
𝑉𝑉0 = ∑𝑁𝑁 𝑛𝑛
𝑛𝑛=0 (1+𝑟𝑟 )𝑛𝑛
𝐹𝐹𝐹𝐹𝐹𝐹
𝑃𝑃𝑃𝑃 (𝐹𝐹𝐹𝐹𝐹𝐹𝑡𝑡 ) = (1+𝑟𝑟)𝑡𝑡 𝑡𝑡 = 𝐹𝐹𝐹𝐹𝐹𝐹𝑡𝑡 × (1+𝑟𝑟)𝑡𝑡
1
𝑛𝑛

𝑟𝑟𝐴𝐴𝐴𝐴 = 𝑟𝑟 − (𝜏𝜏 × 𝑟𝑟) = 𝑟𝑟(1 − 𝜏𝜏) G = SP – BV

𝑟𝑟(1) = 𝑒𝑒 𝐴𝐴𝐴𝐴𝐴𝐴 − 1 BV = PP – AD

APR = ln(1+r(1)) ATCF = SP – τc × G

𝐶𝐶𝐶𝐶×𝐹𝐹𝐹𝐹 𝐷𝐷1 +𝑃𝑃1
𝐶𝐶𝐶𝐶𝐶𝐶 = 𝑃𝑃0 =
𝑁𝑁 1+𝑟𝑟𝐸𝐸

𝐹𝐹𝐹𝐹
𝑃𝑃 = (1+𝑌𝑌𝑌𝑌𝑌𝑌 𝑛𝑛 𝑟𝑟𝐸𝐸 =
𝐷𝐷1 +𝑃𝑃1
−1=
𝐷𝐷1
+
𝑃𝑃1 −𝑃𝑃0
𝑛𝑛 ) 𝑃𝑃0 𝑃𝑃0 𝑃𝑃0

⁄
𝐹𝐹𝐹𝐹 1 𝑛𝑛 𝐷𝐷 𝐷𝐷 +𝑃𝑃2
𝑌𝑌𝑌𝑌𝑌𝑌𝑛𝑛 = � � −1 𝑃𝑃0 = 1+𝑟𝑟1 + (1+𝑟𝑟
2
2
𝑃𝑃 𝐸𝐸 𝐸𝐸 )

rn = YTMn 𝐷𝐷 𝐷𝐷
𝑃𝑃0 = 1+𝑟𝑟1 + (1+𝑟𝑟2 )2 + ⋯ + (1+𝑟𝑟𝑁𝑁 )𝑁𝑁 + (1+𝑟𝑟𝑁𝑁 )𝑁𝑁
𝐷𝐷 𝑃𝑃
𝐸𝐸 𝐸𝐸 𝐸𝐸 𝐸𝐸

1 1 𝐹𝐹𝐹𝐹 𝐷𝐷
𝑃𝑃 = 𝐶𝐶𝐶𝐶𝐶𝐶 × �1 − �(1+𝑦𝑦)𝑁𝑁�� + (1+𝑦𝑦)𝑁𝑁 𝑃𝑃0 = ∑∞ 𝑛𝑛
𝑛𝑛=1 (1+𝑟𝑟 )𝑛𝑛
𝑦𝑦 𝐸𝐸

𝐷𝐷𝐷𝐷𝐷𝐷𝐷𝐷 𝐷𝐷1
𝐶𝐶𝐶𝐶 = 𝐷𝐷𝐷𝐷 − 𝐶𝐶𝐶𝐶𝐶𝐶 � � 𝑃𝑃0 = 𝑟𝑟
𝐷𝐷𝐷𝐷𝐷𝐷𝐷𝐷 𝐸𝐸 −𝑔𝑔

Page 2 of 4
 Introduction to Corporate Finance Formula Sheet (cont)

𝐷𝐷1
𝑟𝑟𝐸𝐸 = + 𝑔𝑔 𝑆𝑆𝑆𝑆 (𝑅𝑅) = �𝑉𝑉𝑉𝑉𝑉𝑉(𝑅𝑅)
𝑃𝑃0

𝑆𝑆𝑆𝑆
𝐸𝐸
𝐷𝐷𝑡𝑡 = 𝑡𝑡 × 𝐷𝐷𝐷𝐷𝐷𝐷𝑡𝑡 𝑆𝑆𝑆𝑆 =
𝑆𝑆𝑆𝑆 √𝑁𝑁
𝑡𝑡

𝑁𝑁𝑁𝑁𝑡𝑡 = 𝐸𝐸𝑡𝑡 × 𝑅𝑅𝑅𝑅𝑡𝑡 𝐶𝐶𝐶𝐶𝐶𝐶 = [(1 + 𝑅𝑅1 ) × (1 + 𝑅𝑅2 ) × ⋯ × (1 + 𝑅𝑅𝑇𝑇 )]1⁄𝑇𝑇 − 1

RRt = 1 – DPRt MRP = E[RMkt] - rf

∆𝐸𝐸𝑡𝑡+1 = 𝑁𝑁𝑁𝑁𝑡𝑡 × 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑡𝑡 𝑟𝑟𝑖𝑖 = 𝑟𝑟𝑓𝑓 + 𝛽𝛽𝑖𝑖 × �𝐸𝐸(𝑅𝑅𝑀𝑀𝑀𝑀𝑀𝑀 ) − 𝑟𝑟𝑓𝑓 �

𝐸𝐸𝐸𝐸𝐸𝐸𝑡𝑡+1 =
∆𝐸𝐸𝑡𝑡+1 𝑀𝑀𝑀𝑀𝑖𝑖 = 𝑁𝑁𝑁𝑁𝑁𝑁𝑖𝑖 × 𝑃𝑃𝑖𝑖
𝐸𝐸𝑡𝑡
𝑀𝑀𝑀𝑀
𝑥𝑥𝑖𝑖 = 𝑇𝑇𝑇𝑇𝑇𝑇𝑖𝑖
𝐸𝐸𝐸𝐸𝐸𝐸𝑡𝑡+1 = 𝑅𝑅𝑅𝑅𝑡𝑡 × 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑡𝑡
𝐷𝐷1
𝑔𝑔𝑡𝑡+1 = 𝑅𝑅𝑅𝑅𝑡𝑡 × 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑡𝑡 𝑟𝑟𝑀𝑀𝑀𝑀𝑀𝑀 = + 𝑔𝑔
𝑃𝑃0

𝑃𝑃𝑃𝑃(𝐹𝐹𝐹𝐹𝐹𝐹𝐹𝐹)
𝑃𝑃0 = 𝑆𝑆𝑆𝑆
�𝑅𝑅𝑖𝑖 − 𝑟𝑟𝑓𝑓 � = 𝛼𝛼𝑖𝑖 + 𝛽𝛽𝑖𝑖 �𝑅𝑅𝑀𝑀𝑀𝑀𝑀𝑀 − 𝑟𝑟𝑓𝑓 � + 𝜀𝜀𝑖𝑖

NI = CE – D 𝐸𝐸 [𝑅𝑅𝑖𝑖 ] = 𝑟𝑟𝑓𝑓 + 𝛽𝛽𝑖𝑖 �𝐸𝐸[𝑅𝑅𝑀𝑀𝑀𝑀𝑀𝑀 ] − 𝑟𝑟𝑓𝑓 � + 𝛼𝛼𝑖𝑖

FCF = EBIT(1-τc) – NI - ∆NWC 𝑟𝑟𝑑𝑑 = (1 − 𝑝𝑝)𝑦𝑦 + 𝑝𝑝(𝑦𝑦 − 𝐿𝐿) = 𝑦𝑦 − 𝑝𝑝𝑝𝑝

𝑉𝑉0 = 𝑃𝑃𝑃𝑃 (𝐹𝐹𝐹𝐹𝐹𝐹 ) Table 12.2: Percent Annual Default Rates by Debt Rating

𝑃𝑃0 =
𝑉𝑉0 +𝐶𝐶0 −𝐷𝐷0 Rating AAA AA A BBB BB B CCC CC-C
𝑆𝑆𝑆𝑆0 Ave. 0.0 0.1 0.2 0.5 2.2 5.5 12.2 14.1
Recessions 0.0 1.0 3.0 3.0 8.0 16.0 48.0 78.0
𝐹𝐹𝐹𝐹𝐹𝐹1 𝐹𝐹𝐹𝐹𝐹𝐹2 𝐹𝐹𝐹𝐹𝐹𝐹 +𝑉𝑉𝑁𝑁
𝑉𝑉0 = 1+𝑟𝑟 + (1+𝑟𝑟 2 + ⋯ + (1+𝑟𝑟𝑁𝑁 𝑁𝑁
𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤) 𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 )
Table 12.3: Average Debt Betas
𝐹𝐹𝐹𝐹𝐹𝐹𝑁𝑁+1
𝑉𝑉𝑁𝑁 = 𝑟𝑟 By Rating A above BBB BB B CCC
𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤−𝑔𝑔𝐹𝐹𝐹𝐹𝐹𝐹
Avg. Beta <.05 .10 .17 .26 .31
𝑃𝑃 𝐷𝐷1 ⁄𝐸𝐸𝐸𝐸𝐸𝐸1
𝐹𝐹𝐹𝐹𝐹𝐹 = 𝐸𝐸𝐸𝐸𝐸𝐸0 = 𝑟𝑟𝐸𝐸−𝑔𝑔
1
By Maturity 1-5 Yr 5-10 Yr 10-15Yr > 15Yr
𝑉𝑉0 𝐹𝐹𝐹𝐹𝐹𝐹1 ⁄𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸1 Avg. Beta 0.01 0.06 0.07 0.14
=
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸1 𝑟𝑟𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 −𝑔𝑔𝐹𝐹𝐹𝐹𝐹𝐹
𝐸𝐸 𝐷𝐷
𝑟𝑟𝑢𝑢 = � � 𝑟𝑟𝑒𝑒 + � � 𝑟𝑟𝑑𝑑
𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷
𝐸𝐸 (𝑅𝑅) = ∑𝑅𝑅 𝑝𝑝𝑅𝑅 × 𝑅𝑅
𝐸𝐸 𝐷𝐷
2 𝛽𝛽𝑢𝑢 = � � 𝛽𝛽𝑒𝑒 + � � 𝛽𝛽𝑑𝑑
𝑉𝑉𝑉𝑉𝑉𝑉(𝑅𝑅) = ∑𝑅𝑅 𝑝𝑝𝑅𝑅 × �𝑅𝑅 − 𝐸𝐸 (𝑅𝑅)� 𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷

ND = D – EC
𝑆𝑆𝑆𝑆 (𝑅𝑅) = �𝑉𝑉𝑉𝑉𝑉𝑉(𝑅𝑅)

𝐷𝐷𝐷𝐷𝐷𝐷𝑡𝑡+1 𝑃𝑃𝑡𝑡+1 −𝑃𝑃𝑡𝑡 rat = r (1 – τc)

𝑅𝑅𝑡𝑡+1 = +
𝑃𝑃𝑡𝑡 𝑃𝑃𝑡𝑡
𝐸𝐸 𝐷𝐷
𝑟𝑟𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 = � � 𝑟𝑟𝐸𝐸 + � � 𝑟𝑟𝑑𝑑 (1 − 𝜏𝜏𝑐𝑐 )
𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷
1+RL = (1+RS1) (1+RS2) (1+RS3)….
𝐷𝐷
1 𝑟𝑟𝑤𝑤𝑤𝑤𝑤𝑤𝑤𝑤 = 𝑟𝑟𝑢𝑢 − � � 𝜏𝜏𝑐𝑐 𝑟𝑟𝐷𝐷
𝑅𝑅� = ∑𝑇𝑇𝑡𝑡=1 𝑅𝑅𝑡𝑡 𝐸𝐸+𝐷𝐷
𝑇𝑇

1 MVE = MVA – MVL

𝑉𝑉𝑉𝑉𝑉𝑉(𝑅𝑅) = ∑𝑇𝑇𝑡𝑡=1(𝑅𝑅𝑡𝑡 − 𝑅𝑅�)2
𝑇𝑇−1
𝛼𝛼𝑠𝑠 = 𝐸𝐸 [𝑅𝑅𝑠𝑠 ] − 𝑟𝑟𝑠𝑠

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 Introduction to Corporate Finance Formula Sheet (cont)

E+D=U=A

𝐸𝐸 𝐷𝐷
� � 𝑅𝑅𝐸𝐸 + � � 𝑅𝑅𝐷𝐷 = 𝑅𝑅𝑈𝑈
𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷

𝐷𝐷
𝑅𝑅𝐸𝐸 = 𝑅𝑅𝑈𝑈 + (𝑅𝑅𝑈𝑈 − 𝑅𝑅𝐷𝐷 )
𝐸𝐸

𝐷𝐷
𝑟𝑟𝐸𝐸 = 𝑟𝑟𝑈𝑈 + (𝑟𝑟𝑈𝑈 − 𝑟𝑟𝐷𝐷 )
𝐸𝐸

𝐷𝐷
𝐸𝐸 (𝑅𝑅𝐸𝐸 ) = 𝐸𝐸 (𝑅𝑅𝑈𝑈 ) + �𝐸𝐸(𝑅𝑅𝑈𝑈 ) − 𝐸𝐸 (𝑅𝑅𝐷𝐷 )�
𝐸𝐸

𝐸𝐸 𝐷𝐷
𝑟𝑟𝑈𝑈 = � � 𝑟𝑟𝐸𝐸 + � � 𝑟𝑟𝐷𝐷
𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷

rwacc = rU = rA

𝐸𝐸 𝐷𝐷
𝛽𝛽𝑈𝑈 = � � 𝛽𝛽𝐸𝐸 + � � 𝛽𝛽𝐷𝐷
𝐸𝐸+𝐷𝐷 𝐸𝐸+𝐷𝐷

𝐷𝐷
𝛽𝛽𝐸𝐸 = 𝛽𝛽𝑈𝑈 + (𝛽𝛽𝑈𝑈 − 𝛽𝛽𝐷𝐷 )
𝐸𝐸

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