1.What is Marriott's overall cost of capital?
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1.   What is Marriott's overall cost of capital?

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overall cost of capital:

Identify bequity at the target debt-equity ratio

Identify appropriate estimate of risk-free rate rf

Identify estimate of market risk premium (rm-rf)

Use CAPM to estimate requity

Identify appropriate measure of rdebt

Use formula: rWACC = (1-TC)[D/(D+E)]rdebt + [E/(D+E)]requity

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