An investor is considering to purchase a new firm, with (1) assets in place, worth $100 million,
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An investor is considering to purchase a new firm, with (1) assets in place, worth $100 million, and (2) a patented technology. What is the value of the firm, if the implementation of the technology with result in NPV of $50 million, will require the investment of $200 million, the uncertainty of the returns from the patented technology (if implemented) is 80% (based on Monte Carlo simulations), the patent protection is for 10 years, and the firm does not anticipate to immediate implement said technology?
Related Book For
Fundamentals of corporate finance
ISBN: 978-0470876442
2nd Edition
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
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