1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Pie
3 years ago
6

Barnette Inc.'s free cash flows are expected to be unstable during the next few years while the company undergoes restructuring.

However, FCF is expected to be $50 million in Year 5, i.e., FCF at t = 5 equals $50 million, and the FCF growth rate is expected to be constant at 6% beyond that point. If the weighted average cost of capital is 12%, what is the horizon value (in millions) at t = 5?a. $719b. $757c. $797d. $839e. $883
Business
1 answer:
kykrilka [37]3 years ago
6 0

Answer:

Horizon value = $883

so correct option is e. $883

Explanation:

given data

FCF is expected = $50 million

time = 5 year

CF growth rate = 6% = 0.06

average cost of capital = 12% = 0.12

to find out

the horizon value

solution

we know that FCF at year 6 is here

FCF at year 6  = principal ( 1 + rate )

FCF at year 6 = 50 × (1 + 6%)

FCF at year 6  = 53 million

and

Horizon value will be here

Horizon value =  \frac{FCF at year 6}{required rate- growth rate}  

Horizon value =  \frac{53}{0.12-0.06}

Horizon value = 883.33

Horizon value = $883

so correct option is e. $883

You might be interested in
1. Which design style resembles a half-moon?
masya89 [10]
The correct answer for the question that is being presented above is this one: 
(1) <span>B. Crescent
</span>(2) C. Clustering
(3) C. are difficult to carry.
(4) B. terracing
(5) <span>B. Ikebana
</span>(6) <span>A. allow designers the opportunity to work with better flowers.
</span>(7) <span>D. Sequencing
</span>(8) <span>B. grouping.
</span>(9) <span>D. terracing.
</span>(10) <span>C. rocky creek bed.</span>
7 0
3 years ago
Read 2 more answers
Alfonso has noticed that increases in unemployment insurance claims are associated with recessions, and therefore be advocates l
7nadin3 [17]

Answer:

<em>c. The reasoning of both Alfons and Mary suffers from the omitted variable problem</em>

Explanation:

The issue of omitted variables occurs as a result of mis-specification of a linear regression model, which could be either because the impact of the omitted variable on both the dependent variable is unclear, or the evidence was not accessible.

This causes you to omit the variable from your regression, resulting in over-estimation (upward bias) or underestimation (downward) of the influence of one of the other predictor variables.

3 0
3 years ago
The circular flow of income model shows
zloy xaker [14]

the correct answer is letter C:)

Hope it's help!! :))

happy sunny or night

7 0
2 years ago
Jayhawk Foods Inc. is a snack manufacturer that wants to expand globally. Few people abroad are familiar with Jayhawk Foods snac
cestrela7 [59]

Answer:

the answer is option B) the leaders of Jayhawk Foods should pursue a multidomestic strategy that includes new "local" brands.

Explanation:

Understanding how best to meet your customers needs is a sure way to maximize profits and generate more sales.

Having identified the need for a high degree of local responsiveness when it comes to food, Jayhawk Foods Inc., a snack manufacturer that wants to expand globally should pursue a multi domestic strategy for their branches globally.

Multi Domestic strategy is an international marketing strategy that is responsive to the local market by driving advertising and sales efforts towards the needs that the local consumers are most responsive to.

3 0
3 years ago
As part of your plan to lead the change effort to increase team productivity, you want to build momentum by generating short-ter
Murljashka [212]

Answer: Visible to senior leadership but not lower levels of the organization

Explanation:

Most short term wins are not visible to senior leadership, but are obvious to lower levels of the organization. The senior leadership wants results at the end of a business day and may not recognize the efforts that have been put in place by lower level of the organization for the progress that is noticeable so far.

3 0
3 years ago
Other questions:
  • Edward philips signs a deed allowing the utility company to suspend power lines over his land. a utility company's right to use
    15·1 answer
  • Bates Company currently produces and sells 4,000 units of a product that has a contribution margin of $5 per unit. The company s
    10·1 answer
  • Which benefit typically costs an employer the most to provide?
    7·1 answer
  • Knowledge that gives a producer an economic advantage over other producers is called a _____.
    11·2 answers
  • While noreen was driving down the highway, she saw two cars on the side of the road. she noticed that no one was hurt and that n
    14·1 answer
  • Assume that on December 31, 2019, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage buildi
    5·1 answer
  • Van lives in Houston and runs a business that sells pianos. In an average year, he receives $851,000 from selling pianos. Of thi
    5·1 answer
  • The financial statements of an Enterprise fund are prepared using the :_______
    13·1 answer
  • If you were a systems administrator for a data center, what steps would you take to create and manage a data center to store the
    12·1 answer
  • n rural areas electrical power is often sold by ____________ that take advantage of the government's policy to sell them electri
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!