The owner of a small business expects to generate a profit of $100,000 per year for 2 years and is going to sell the firm at the end of the second year for $800,000. The owner believes that the appropriate discount rate for the firm is 10% per year. What is the value of the small business based on the assumptions that the owner has set?

Solve the activity and show all the computations. In the end, summarize it by giving the numerical solution only. Please it should not have any exponent formulas. I think this is just a simple computation.

Answer rating: 100% (QA)

Discounted Cash Flow DCF Analysis This scenario can be solved using the Discounted Cash Flow DCF ana... View the full answer