Question: This company will be sold after the second year. What is the amount of capital needed? Assuming a required rate of return by investors of
This company will be sold after the second year. What is the amount of capital needed?
Assuming a required rate of return by investors of 20% per annum and the sale of the company at the end of the second year at seven times Year 2 EBITDA what is the company worth? (Please note that when discounting monthly cash flows you will need to divide the interest rate by 12.)


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