Part 1 of Essay
Through my research of Pepsico, I have calculated the cost of capital. A firm's cost of capital is imperative because it represents the funds used to finance the firm's assets and operations. First you have to estimate the cost of capital in order to minimize it. In estimating the cost of capital, you first have to fin ....

Part 2 of Essay
.... First I found the three growth rates which were historical, forecast, and sustainable growth. The historical and forecast annual rates I simply pulled directly from Value Line under Past 10 years and estimated years of the dividends. They both were 14.0%. The sustainable growth is calculated by taking the retention rate (b) and multiplying it by the return on equity (r ). To find b, I first calculated the dividends payout ratio which is DPS/EPS. I pulled DPS and EPS from value line under 1997. Then ....