Title: Can Dr. Anya Sharma Afford to Acquire Her Practice? A $150,000 WACC Deep Dive Tagline: Can Dr. Anya Sharma Afford to Acquire Her Practice? A $150,000 WACC Deep Dive Problem: Dr. Anya Sharma, a 35-year-old physician, dreams of acquiring the established practice where she's currently employed. The asking price is $750,000. She has $280,000 in student loan debt at 6.8% interest and diligently maxes out her retirement accounts. Her current salary is $220,000. The practice generates consistent revenue, but its current owners have a high debt burden (equipment leases, building mortgage) and a relatively high cost of capital. Anya needs to determine if acquiring the practice is financially sound, considering her existing debt and the current practice's capital structure. Can she realistically lower the cost of capital and make the acquisition profitable? Solution: By using the Cost of Capital Calculator, Dr. Sharma can analyze the practice's current WACC, stress-test different debt and equity structures post-acquisition, and determine the required return on investment needed to justify the purchase price. She can explore scenarios involving refinancing the practice's existing debt, injecting more equity (her savings and potentially attracting investors), and renegotiating supplier contracts to improve profitability and, consequently, the WACC. The calculator helps her quantify the potential financial benefits and risks of the acquisition. ROI: By reducing the practice's WACC from its current 12% to a more manageable 9% through debt refinancing and operational efficiencies, Dr. Sharma can increase the practice's valuation by approximately $150,000, making the acquisition price attractive. A lower WACC translates to a higher present value of future cash flows, justifying the $750,000 purchase. A decrease in WACC by 3% increases the net present value of the cash flows by more than 20%. Description: Determine the financial feasibility of acquiring a medical practice with a precise cost of capital analysis. This calculator helps Dr. Sharma understand if her dream practice purchase is truly viable. Category: Lead Gen