Question: Sandy River Oil Sands Ltd. (SROS) has a terminal value of $200 million. SROS used a cost of capital of 20%. Required: (a) Calculate the

Sandy River Oil Sands Ltd. (SROS) has a terminal value of $200 million. SROS used a cost of capital of 20%.
Required:
(a) Calculate the present value of the terminal value of SROS with a planning horizon of:
1. 8 years
2. 15 years
3. 20 years.
(b) Define present value of the terminal value.
(c) What do you conclude about the terminal value of the business using a planning horizon of 20 years?

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