Procter and Gamble: Cost of Capital

  title={Procter and Gamble: Cost of Capital},
  author={Kenneth M. Eades},
To assess whether a company should enter the household-products market, Procter and Gamble's weighted average cost of capital is computed. Clorox's cost of capital is also computed as a check on the P&G estimate. This case emphasizes the conceptual as well as the mechanical aspects of computing cost of capital for a company with homogeneous business risk and stable capital structure.