A comparison of the weighted average cost of capital for multinational corporations: the case of the automobile industry versus the soft drink industry

Authors

C. B. McGowan, Universiti Kebangsaan MalaysiaFollow
A. Tessema, Eastern Michigan University, USAFollow
H. W. Collier, University of WollongongFollow

RIS ID

29087

Publication Details

This article was originally published as McGowan, CB, Tessema, A and Collier, HW, A comparison of the weighted average cost of capital for multinational corporations: the case of the automobile industry versus the soft drink industry, The Journal of Current Research in Global Business, 6(9), Winter 2004, 82-88.

Abstract

The object of this paper is to determine to what extent the cost of capital differs across comparisons in different countries. In this paper, wecompare and contract the cost of capital for five countries in the soft drink industry and seven companies in the automobile industry. We find that the weighted average cost of capital for the four largest companies in the soft drink industry are similar and the weighted cost of capital for seven companies in the automobile industry are less similar. Since the companies in this study are all large, multinational companies in a single industry, numerous confounding variables are controlled.