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Nutka1998 [239]
3 years ago
8

A company is undergoing a restructuring, and its free cash flows are expected to vary considerably during the next few years. Ho

wever, the FCF is expected to be $85.00 million in Year 5, and the FCF growth rate is expected to be a constant 6.5% beyond that point. The weighted average cost of capital is 12.0%. What is the horizon (or continuing) value (in millions) at t
Business
1 answer:
Bumek [7]3 years ago
7 0

Answer:

Value of company = $982.16

Explanation:

The free cash flow is the cash generated by a company that is not retained and reinvested. It is the cash flow available to all providers of capital . It is available to pay dividend or finance other project

The value of the company would be the present value of its free cash flow discounted at the weighted average cost of capital.

Value of company )year 4= 85/(0.12-0.065) = 1,545.45

Value of company (in year 0) = 1,545.45× 1.12^(-4)= 982.16

Value of company = $982.16 millions

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What is the primary reason that so many new businesses fail??
morpeh [17]
The reason why business fail is because they find it extremely hard to compete with the well known business. for example a man that opens up a buisiness that sells soap and decides to name the soap and company labbi but everyone goes to dove because it's more well known and been out for years and delivers high quality 
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3 years ago
Assume for Guatemala that the domestic price of coffee without international trade is higher than the world price of coffee. Thi
Marina CMI [18]

Answer:

other countries have a comparative advantage over Guatemala in the production of coffee, and Guatemala will import coffee. 

Explanation:

This question is incomplete. Please check the attached image for a complete question.

A country has comparative advantage in the production of a good or service If it produces the good or service at a lower opportunity cost when compared to its trading partners.

The price of Guatemala's coffee is higher when compared to the world price of coffee without international trade. It shows that Guatemala doesn't have a comparative advantage in the production of coffee. Guatemala should stop producing coffee and import instead. This would enable Guatemala focus more resocurces on the production of good for which it has comparative advantage.

I hope my answer helps you

3 0
3 years ago
Aden is a small engine mechanic who earns a regular hourly rate of $15.68. For overtime, he earns time and a half on Saturdays a
garri49 [273]

Answer:

Total pay is : $909.44

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15.68 times 2 = 31.36 times 7 = 219.52

$627.20 +$ 62.72 + $219.52 = $ 909.44

3 0
2 years ago
At the end of the year, a company has a balance in Allowance for Uncollectible Accounts of $2,200 (credit) before any year-end a
Lapatulllka [165]

Answer: Debit Bad debt expense $7,300; Credit Allowance for doubtful accounts $7,300.

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3 years ago
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