IDEAS home Printed from https://ideas.repec.org/a/prg/jnloce/v11y2018i4id2018_4_03p23-39.html
   My bibliography  Save this article

Reagent function and beta coefficient in the calculation of the discount rate - part (variable level of debt and different discount rates for the tax shield)
[Reagenční funkce a koeficient beta při kalkulaci diskontní míry - 2. část (proměnlivá úroveň cizího kapitálu a různé diskontní míry pro daňový štít)]

Author

Listed:
  • Miloš Mařík
  • Pavla Maříková

Abstract

The second part of the article is aimed at presenting a complete set of functions for the calculation of the leveraged beta coefficient. While the previous first part of the article dealt with procedures appropriate at a stable level of debt, this second part of the article presents equations for the calculation of leveraged betas appropriate at a changing level of debt, for different assumptions regarding the discount rate for tax shields: a discount rate at the cost of debt, a discount rate at the level of unleveraged equity costs and, in particular, a design of a universal function enabling the valuer to choose any discount rate for tax shields. At the same time, the article explains how to apply these functions specifically, in particular how to calculate the betas of debt and betas of the tax shield that are necessary for the correct calculation of the leveraged beta.

Suggested Citation

  • Miloš Mařík & Pavla Maříková, 2018. "Reagent function and beta coefficient in the calculation of the discount rate - part (variable level of debt and different discount rates for the tax shield) [Reagenční funkce a koeficient beta při," Oceňování, Prague University of Economics and Business, vol. 11(4), pages 23-39.
    • Handle: RePEc:prg:jnloce:v:11:y:2018:i:4:id:2018_4_03:p:23-39
    DOI: 10.18267/j.ocenovani.220
    as

    Download full text from publisher

    File URL: http://ocenovani.vse.cz/doi/10.18267/j.ocenovani.220.html
    Download Restriction: free of charge
    File URL: http://ocenovani.vse.cz/doi/10.18267/j.ocenovani.220.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.18267/j.ocenovani.220?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Value; Business valuation; Cost of equity; Beta; Tax shield; Capital structure; Hodnota; Ocenění podniku; Náklady vlastního kapitálu; Daňový štít; Kapitálová struktura;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:prg:jnloce:v:11:y:2018:i:4:id:2018_4_03:p:23-39. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Stanislav Vojir (email available below). General contact details of provider: https://edirc.repec.org/data/uevsecz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.