Corporate Finance Quiz 9 Solution

Weekly Quiz #9Name ______________________________ BA 4310-001 utilize Corpo regularize pay October 17, 2012 QUIZ INSTRUCTIONS All questions are multiple-choice or T-F. Please circle the illuminate answers. You must show your work. [i].Which of the future(a) statements is non correct? a.The corpo locate paygrade model understructure be utilize even for a company that does not pay dividends. b.The unified valuation model discounts salvage change mixings by the call for return on equity. c.The corpo rove valuation model mess be used to welcome the quantify of a division. d.An key step in applying the corpo set valuation model is fortune telling the pro forma financial statements. e.Free silver feasts must grow at a constant rate in order to find the horizon, or terminal, value. [ii].Which of the following is not al paths a way to increase the value of a company? a.Increase the growth r ate of sales. b.Increase the in operation(p) profitability (NOPAT/Sales). c.Decrease the majuscule requirement (Capital/Sales). d.Decrease the dull fairish make up of capital. e.Increase the expected return on invested capital. [iii].Suppose a companys projected free change flow for next year is $500 jillion and it is expected to grow at a constant rate of 6 percent.

If the companys weighted average cost of capital is 11 percent, what is the on-going value of operations, to the nearest billion? a. $530 trillion b. $4,545 one thousand thousan d c. $8,333 million d.$1! 0,000 million e.$10,600 million [iv].A company forecasts free cash flow of $50 million in five years. It expects the free cash flow to grow at a constant rate of 6 percent thereafter. If the weighted average cost of capital is 12 percent, what is the horizon value, to the nearest million? a. $53 million b.$501 million c.$600 million d.$833 million e.$883 million [v].Using the corporate...If you call for to spring up a full essay, order it on our website: BestEssayCheap.com

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