... calculate, or estimate, the equity cost of capital. Keywords Weighted Average Cost of Capital, WACC, firm valuation, capital budgeting, equity cost of capital. JEL codes D61, G31, H43 ... perpetuity List of symbols Ku The cost of the unlevered equity Kd The cost of debt (assumed constant) D Market value of debt Ken Levered cost of equity at year n EL Market value of levered ... cost of equity and the cost of debt, where the cost of debt is adjusted by the coefficient (1 - ) and the weights are the market value of equity and market value of debt, as percentages of the...