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Originally Posted by DRS112
okay...separate discussion
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It is the discussion. I view corporations as inherently evil. these are some of the reasons they are. you see them as the greatest thing since jesus.
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No actually it's finacial FACT...A company will take on a debt/equity structure that produces the lowest WACC(Weighted Asset Cost of Capital)
Which the formula looks like this...
Weight of debt * (cost of debt * 1- tax rate) + weight of equity * cost of equity.
wd(Rd*1-t)+We(Re)
So plugging numbers into that equation...the higher the tax rate the lower the cost of debt is going to be.
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Yes, formulas are very nice. given the right formula I can prove anything.
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overly simplistic and completly rhetoric
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and totally true.
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I'm saying that is what you'd be doing.
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I'm saying we're fucked everyday by corporations.
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And....pointing out the cost of goods doesn't prove a thing....
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Proves inflation.