Suppose that in 2023, Global launches an aggressive marketing campaign that boosts sales by 15%. However, their

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Suppose that in 2023, Global launches an aggressive marketing campaign that boosts sales by 15%.

However, their operating margin falls from 5.57% to 4.50%. Suppose that they have no other income, interest expenses are unchanged, and taxes are the same percentage of pretax income as in 2022.

a. What is Global’s EBIT in 2023?

b. What is Global’s net income in 2023?

c. If Global’s P/E ratio and number of shares outstanding remains unchanged, what is Global’s share price in 2023?

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Corporate Finance

ISBN: 9781292446318

6th Global Edition

Authors: Jonathan Berk, Peter DeMarzo

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Question Posted: Mar 29, 2024 09:00 PM

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Suppose that in 2023, Global launches an aggressive marketing campaign that boosts sales by 15%. However, their

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Corporate Finance

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