Question: briefly explain Question 3 (9 marks) Company A Enterprise Value $ 70 billion Cash $ 500mil Return on Capital 5% Cost of Capital 5% Trades

briefly explain

Question 3 (9 marks) Company A Enterprise Value $ 70 billion Cash $ 500mil Return on Capital 5% Cost of Capital 5% Trades in Company B $ 70 billion $ 500mil 5% 10% US Company C $ 70 billion $ 500 mil 34% 10% Argentina US In which of these companies is cash most likely to be a neutral asset, a wasting asset, and a potential value creator? Briefly Explain. (9 marks)

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