Apple computer had no debt total equity capitalization of


1.In June 2009, Apple Computer had no debt, total equity capitalization of $128 billion, and a (equity) beta of 1.7 (as reported on Google Finance). Included in Apple’s assets was $25 billion in cash and risk-free securities. Assume that the risk-free rate of interest is 5% and the market risk premium is 4%.

a. What is Apple’s enterprise value?

b. What is the beta of Apple’s business assets?

c. What is Apple’s WACC?

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Finance Basics: Apple computer had no debt total equity capitalization of
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