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Likurg_2 [28]
3 years ago
15

Suppose Boyson Corporation's projected free cash flow for next year is FCF1 = $100,000, and FCF is expected to grow at a constan

t rate of 6.5%. If the company's weighted average cost of capital is 11.5%, what is the firm's total corporate value?
Business
1 answer:
Molodets [167]3 years ago
5 0

Answer:

Value of firm today = $2,000,000

Explanation:

Provided details are,

Future Cash Flow = $100,000

Expected growth rate = 6.5%

Weighted average cost of capital = 11.5%

Firm's total corporate value = \frac{Future\ Cash\ Flow}{Cost\ of\ capital - growth\ rate}

= \frac{100,000}{0.115 - 0.065}

= \frac{100,000}{0.05}

= $2,000,000

Thus, value of firm today with the details provided = $2,000,000

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Home loan only have about 4 -5 % interest rate. Compared to other options :

- Credit Card Loan : about 15 %  of interest rate
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6 0
3 years ago
Read 2 more answers
Chocoheaven processes cocoa beans into cocoa powder at a processing cost of $ 10,100 per batch. Chocoheaven can sell the cocoa p
sp2606 [1]

Answer:

No, it is not the right decision. The best decision that will bring maximum profit to the company is to sell chocolate syrup.

Explanation:

Profit = Sales revenue - Processing Cost

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5 0
3 years ago
In a command economy, the head of each household makes the fundamental economic choices such as what to produce and how to produ
uysha [10]

Answer:

B) False

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In a command economy, the government makes the fundamental economic choices such as what to produce and how to produce output.

The government also owns means of production.

I hope my answer helps you

8 0
4 years ago
The United States Bureau of Labor Statistics (BLS) conducts the Quarterly Census of Employment and Wages (QCEW) and reports a va
Wittaler [7]

Answer:

Answer for the question:

The United States Bureau of Labor Statistics (BLS) conducts the Quarterly Census of Employment and Wages (QCEW) and reports a variety of information on each county in America. In the third quarter of 2016, the QCEW reported the total taxable earnings, in millions, of all wage earners in all 3222 counties in America.

is given in the attachment.

Explanation:

7 0
3 years ago
Diz Co. is a U.S.-based MNC with net cash inflows of euros and net cash inflows of Swiss francs. These two currencies are highly
VikaD [51]

Answer:

Yanta Co. has a higher exposure to exchange rate risk than Diz Co.

The reason is that Yanta Co. does not have net inflows of euros.  Instead, its euro transactions yield net outflows.

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a) Data and Analysis:

Diz Co. has net cash inflows of euros and net cash inflows of swiss francs

Yanta Co. has net cash outflows of euros and net cash inflows of swiss francs

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5 0
3 years ago
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