Question: Given the following inputs, compute the continuing value (CV) at time t in the economic-profit model. At time t invested capital equals $2,000. The NOPAT

Given the following inputs, compute the continuing value (CV) at time t in the economic-profit model. At time t invested capital equals $2,000. The NOPATt+1 is $240 and ROICt+1 is 10 percent. The long-term growth rate equals 2 percent and the WACC is 7 percent. The continuing value at time t is closest to:

a.

$411

b.

$857

c.

$1,840

d.

$1,268

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