Question: Consider the table given below to answer the following question. Assuming that competition drives down profitability (on existing assets as well as new investment) to

Consider the table given below to answer the following question.

Consider the table given below to answer the following question. Assuming that

Assuming that competition drives down profitability (on existing assets as well as new investment) to 14.5% in year 6, 14% in year 7, 13.5% in year 8, and 11% in year 9 and all later years. What is the value of the concatenator business? Assume 13% cost of capital.

competition drives down profitability (on existing assets as well as new investment)

Present value million

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