In company X regarding year N, it was possible to obtain the following data (thousand euros):...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
In company X regarding year N, it was possible to obtain the following data (thousand euros): - Question III - The net investment is 400 and the working capital change os negative of -1.100. The EBIT is 6.850 and the tax rate of companies is 25%. The predicted growth rates for the Free Cash Flow for the following years are: 5% between N+1 and N+4. The perpetuity period starts N+5 and the growth rate in perpetuity is 2%. The Weighted Average Cost of Capital is 7%. The debt of the company is 20.000, due to a zero-coupon bond issue with repayment at par in 5 years. The YTM of bonds with similar risk is 3%. The paid-in capital is represented by 20.000.000 shares, with a nominal value of 1 euro each. Requests: 1. Calculate the Free Cash Flow for year N. 2. Calculate the value per share for year N. In company X regarding year N, it was possible to obtain the following data (thousand euros): - Question III - The net investment is 400 and the working capital change os negative of -1.100. The EBIT is 6.850 and the tax rate of companies is 25%. The predicted growth rates for the Free Cash Flow for the following years are: 5% between N+1 and N+4. The perpetuity period starts N+5 and the growth rate in perpetuity is 2%. The Weighted Average Cost of Capital is 7%. The debt of the company is 20.000, due to a zero-coupon bond issue with repayment at par in 5 years. The YTM of bonds with similar risk is 3%. The paid-in capital is represented by 20.000.000 shares, with a nominal value of 1 euro each. Requests: 1. Calculate the Free Cash Flow for year N. 2. Calculate the value per share for year N.
Expert Answer:
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date:
Students also viewed these finance questions
-
A firm is considering replacing a machine that has been used to make a certain kind of packaging material. The new, improved machine will cost $31,000 installed and will have an estimated economic...
-
A company is considering replacing a machine that was bought six years ago for $60,000. The machine, however, can be repaired and its life extended by five more years. If the current machine is...
-
A company is considering replacing a machine that was bought six years ago for $50,000. The machine, however, can be repaired and its life extended by five more years. If the current machine is...
-
What is the advantage of using computing to simulate an automobile crash test as opposed to actually staging a crash?
-
Tyrone is a utility maximizer. His income is $100, which he can spend on cafeteria meals and on notepads. Each meal costs $5, and each notepad costs $2. At these prices Tyrone chooses to buy 16...
-
A delicatessen is open 24 hours a day every day of the week. On the average, 24 orders are received by fax every two hours throughout the day. a. Find the probability that a faxed order will arrive...
-
Information disclosed in financial reports should have a number of characteristics (e.g. understandability, neutrality). What are these characteristics? Provide two examples of situations where there...
-
Big Sky Sports sells hunting and fishing equipment and provides guided hunting and fishing trips. Big Sky Sports is owned and operated by Joe Flannery, a well-known sports enthusiast and hunter....
-
Watta Company has only common equity and bonds. You are asked to estimate Watta Company's WACC and you have the following information: Watta's next stock dividend is expected to be $1 per share. This...
-
In preparing for the upcoming holiday season, Fresh Toy Company (FTC) designed a new doll called The Dougie that teaches children how to dance. The fixed cost to produce the doll is $100,000. The...
-
The electronegativity of H is 2.1 and for K it is 0.8. Based on these electronegativities, KH would be expected to: A. Be ionic and contain H ions B. Be ionic and contain K+ ions C. Have polar...
-
Discuss the role of cytokines and chemokines in coordinating the immune response, and what is their impact on inflammatory diseases when dysregulated ?
-
11. A block weighing 75 lbs. sits on an inclined plane where the coefficient of friction is 0.45. a. If the angle is 40.0, will the block slide down on its own? b. What would it take to drag the...
-
When shareholders increase their wealth through downsizing, does this come, to some degree, at the expense of loyal employeesthose who have worked diligently to serve the firm in terms of...
-
1. Who are three important stakeholders to ElectroChem and why? This means specific to ElectroChem during the time of the case not historical. -- 2. What are two segments of the General Environment...
-
Describe the effects of the collegial process in forming a judge's personal opinion on an issue. Suggest at least 2 effects that power and prestige have on a judge when an outcome of a case is being...
-
How will the frequency of the pendulum change, if we increase its length four times?
-
Use translations to graph f. f(x) = x-/2 +1
-
The annual demand for an item that can be either purchased or produced is 3000 units. Costs associated with each alternative are as follows: Should the item be manufactured or purchased? What is the...
-
If a nominal interest rate of 8% is compounded continuously, determine the unknown quantity in each of the following situations: a. What uniform EOY amount for 10 years is equivalent to $8,000 at EOY...
-
During your first month as an employee at Greenfield Industries (a large drill-bit manufacturer), you are asked to evaluate alternatives for producing a newly designed drill bit on a turning machine....
-
A persons height is an example of a continuous variable. In Exercises 1114, determine whether the statement is true or false. If the statement is false, rewrite it as a true statement.
-
In a cluster sample, the population is divided into groups, and a random sample from each group is drawn. In Exercises 1316, determine whether the statement is true or false. If the statement is...
-
True or false: The way that questions are worded on a survey may have an effect on the responses.
Study smarter with the SolutionInn App