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sammy [17]
4 years ago
6

Which of the following is the appropriate way to calculate the price of a share of a given company using the free cash flow valu

ation​ model?
A. P0​ = ​(V0​ + Cash0 - Debt0​) ​/ (Shares Outstanding0​)
B. P0​ = Div1​/(rE - g​)
C. P0​ = PV​(Future Free Cash Flow of​ Firm) /​ (Shares Outstanding0​)
D. P0​ = ​[Div1 ​/ ​(rE - g​)] ​/ (Shares Outstanding0​)
Business
1 answer:
vfiekz [6]4 years ago
4 0

Answer: Under the free cash flow valuation​ model, free cash flows in future are projected.  These are discounted by the adjusted capital cost i.e. (debt and equity).

Therefore, the appropriate way to calculate the price of a share of a given company using the free cash flow valuation​ model is given as :

P_{0} = \frac{V_{0}+Cash_{0}-Debt{0}}{(Outstanding Share)_{0}}

<u><em>Here, the correct option is (a). i.e. P_{0} = \frac{V_{0}+Cash_{0}-Debt{0}}{(Outstanding Share)_{0}}</em></u>

<u><em></em></u>

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Answer:bbbb

$2,600

Explanation:

$2,200 withheld from her wages for state income taxes during 2018 + The $400 she paid as an additional taxes for her 2017 state tax return.

$2,200 + $400 =$ 2,600

7 0
3 years ago
A company’s capital structure decisions address the ways a firm’s assets are financed (using debt, preferred stock, and common e
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Answer:

Option D (The optimal........capital) would be the right choice.

Explanation:

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  • Such alternatives are meaningless since the optimal capital structure is not reflected by them. Maximizing earnings growth, interest burdens, or equity burdens would not enhance the worth including its shareholder.
7 0
3 years ago
Optimization using total value calculates ________.
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Answer:

A

Explanation:

Optimization using total value calculates the total value of each feasible option and then picks the option with the highest total value.

Optimization using marginal analysis calculates the change in total value when a person switches from one feasible option to another, and the uses these marginal comparisons to choose the option with the highest total value.

Both gives identical answers.

Optimization can be implemented using many different techniques.

One of it, is Total value total benefit - total cost (net benefit).

It translate all cost and benefits into common units, like dollar per month.

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7 0
3 years ago
An investment offers to double your money in 30 months (don’t believe it). What rate per six months are you being offered? (Do n
kykrilka [37]

Answer:

9.05%

Explanation:

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[(FV / PV)^1/N ] - 1

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M = 5 (30 months / 6 months )

(2 ^1/8) - 1 = 0.090508 = 9.05%

I hope my answer helps you

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Explanation:

See the following images to get proper explanation

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