Suppose the current value of a dealership is $5.06 million and the first-year free cash flow...

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Suppose the current value of a dealership is $5.06 million and the first-year free cash flow is expected to be $510,000. What is the beta of a corporation whose only asset is a one-year option to open a dealership? What is the beta if the first year's cash flows are expected to be $690,000, so a working dealership is worth $6.85 million? Assume that the beta of the dealership is 2.1 and that the appropriate cost of capital for this investment is 11.6%. Also consider that the volatility and the risk-free rate are 36% and 5.4%, respectively. What is the beta of a corporation whose only asset is a one-year option to open a dealership? The current value of the asset without the dividends is $ million. (Round to four decimal places.) The present value of the value of the dealership is $ million. (Round to four decimal places.) The value of d is while the value of d is (Round to four decimal places.) The value of the option is $ million. (Round to four decimal places.) The beta is (Round to two decimal places.) What is the beta if the first year's cash flows are expected to be $690,000, so a working dealership is worth $6.85 million? If a working dealership is worth $6.85 million, the current value of the asset is $ million. (Round to four decimal places.) The value of d is while the value of d is (Round to four decimal places.) Substituting into the Black-Scholes formula: The value of the option is $ million. (Round to four decimal places.) The beta is (Round to two decimal places.) Suppose the current value of a dealership is $5.06 million and the first-year free cash flow is expected to be $510,000. What is the beta of a corporation whose only asset is a one-year option to open a dealership? What is the beta if the first year's cash flows are expected to be $690,000, so a working dealership is worth $6.85 million? Assume that the beta of the dealership is 2.1 and that the appropriate cost of capital for this investment is 11.6%. Also consider that the volatility and the risk-free rate are 36% and 5.4%, respectively. What is the beta of a corporation whose only asset is a one-year option to open a dealership? The current value of the asset without the dividends is $ million. (Round to four decimal places.) The present value of the value of the dealership is $ million. (Round to four decimal places.) The value of d is while the value of d is (Round to four decimal places.) The value of the option is $ million. (Round to four decimal places.) The beta is (Round to two decimal places.) What is the beta if the first year's cash flows are expected to be $690,000, so a working dealership is worth $6.85 million? If a working dealership is worth $6.85 million, the current value of the asset is $ million. (Round to four decimal places.) The value of d is while the value of d is (Round to four decimal places.) Substituting into the Black-Scholes formula: The value of the option is $ million. (Round to four decimal places.) The beta is (Round to two decimal places.)