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wacc_computation__unlever_beta

Convert levered equity beta to unlevered beta for WACC calculation, assuming zero debt beta. Provide levered beta, debt-to-equity ratio, and tax rate.

Instructions

[wacc-computation] Hamada unlevering (debt beta assumed zero).

Input Schema

TableJSON Schema
NameRequiredDescriptionDefault
tax_rateYes
levered_betaYes
debt_to_equityYes
Behavior2/5

Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

No annotations are provided. The description does not disclose any behavioral traits such as computational assumptions beyond the formula, side effects (none expected), or authentication needs. It relies on domain knowledge about Hamada's formula.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Conciseness3/5

Is the description appropriately sized, front-loaded, and free of redundancy?

The description is extremely concise (one sentence) but lacks structural elements like a separate usage section. The bracket prefix '[wacc-computation]' adds minimal value. It is not well-organized for an AI agent.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Completeness2/5

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

Given no output schema and sparse description, the tool's behavior is under-specified. An AI agent would need to infer the intended output (unlevered beta) and formula details, making it incomplete for effective invocation.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Parameters1/5

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

The input schema has three parameters with 0% description coverage, and the tool description adds no additional meaning. Parameter names are self-explanatory but no format details (e.g., tax rate as decimal vs percentage) are provided.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Purpose4/5

Does the description clearly state what the tool does and how it differs from similar tools?

The description clearly states the tool performs 'Hamada unlevering' with an assumption of zero debt beta, which is a specific financial calculation. It identifies the input parameters indirectly via the formula context. However, it lacks an explicit statement like 'computes unlevered beta' to distinguish from sibling 'relever_beta'.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Usage Guidelines2/5

Does the description explain when to use this tool, when not to, or what alternatives exist?

No guidance on when to use this tool versus alternatives like 'relever_beta' or other wacc-related tools. The only contextual clue is the assumption note, but no explicit when/when-not instructions.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.

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