Answer questions 37-38 based on the following information: 2017 2020 EBITDA 800 1200 37. Assume that...
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Answer questions 37-38 based on the following information: 2017 2020 EBITDA 800 1200 37. Assume that in 2017 the company was purchased for a 7x multiple, using $3,400 of debt. Assume that in 2020 the company is sold for a 7x multiple, and there was $2,400 of debt outstanding when the company was sold. What is the equity return? 38. Now assume that the company was purchased for an 7x multiple in 2017, but in this case $4,500 of debt was used. Assume that in 2020 the company is sold for a 7x multiple, and there is still $4,500 of debt outstanding when the company is sold. What is the equity return? Answer questions 37-38 based on the following information: 2017 2020 EBITDA 800 1200 37. Assume that in 2017 the company was purchased for a 7x multiple, using $3,400 of debt. Assume that in 2020 the company is sold for a 7x multiple, and there was $2,400 of debt outstanding when the company was sold. What is the equity return? 38. Now assume that the company was purchased for an 7x multiple in 2017, but in this case $4,500 of debt was used. Assume that in 2020 the company is sold for a 7x multiple, and there is still $4,500 of debt outstanding when the company is sold. What is the equity return?
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