Question: You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5 ? Year

You are using the value-based management model. Based on the following

You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5 ? Year 1: Revenue: 650 Fixed Costs: 90 Variable costs: 220 Additional investments in NWC: 3 Additional investments in operating long-term assets: 80 Depreciation: 75 Corporate tax rate: 0.40 WACC COMP:0.12 Growth rate per year: From year 1 through year 5: 0.08 After year 5: 0.06 Select one: a. $3,414.04 b. $3,629.33 c. $3,532.76 d. $3,766.90 The correct answer is: $3,629.33

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Can you please provide the explanation, formula and correct answer for the problem above? I need specific step by step on how to solve the problem. The answer is C) $3,629.33, can you please explain...

Question 18 Not yet answered Marked out of 2.00 Flag question You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5? Year 1:...

Question 18 You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5? Not yet Year 1: answered Marked out of Revenue: 650 2.00 Fixed...

You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5? Year 1: Revenue: 650 Fixed Costs: 90 Variable costs: 220 Additional...

You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5? Year 1 Revenue 650.00 Fixed costs 90.00 Variable costs 220.00 Additional...

You are using the value-based management model. Based on the following data, what is the horizon value at the end of year 5? Year 1 Revenue 650.00 Fixed Costs 90.00 Varibale Costs 220.00 Additional...

Question 1 4 Not answered Marked out of 2 . 0 0 > Flag fuestion You are using the value - based management model. Based on the following data, what is the free cash flow for year 1 ? Year 1 :...

You are using the value-based management model. Based on the following data, what is the free cash flow for year 1? Year 1: Revenue: 665 Fixed Costs: 80 Variable costs: 250 Additional investments in...

You are using the value-based management model. Based on the following data, what is the free cash flow for year 1? Year 1 Revenue 665.00 Fixed costs 80.00 Variable costs 250.00 Additional investment...

According to the value-based management model, what is the stock price per share given the following data? Year 1: Revenue: 750 Fixed Costs: 50 Variable costs: 200 Additional investments in NWC: 3...

Mr. Rogers borrowed $899,000 from you 4 years ago Assuming you charge 4% interest per year how much will Mr. Rogers need to pay you back today the due date of the loan?

Countries have had problems with the stability of their money. Briefly describe the problem caused for financial statements when money does not hold a stable value.

If you deposit $240 every month for the next 8 years, with first deposit to be made today and all deposits to be made at the beginning of every month, in an account that pays 8.94% APR with quarterly...

Which of the following are problems with identifying users of ABC? Multiple select question. ABC means different things to different organizations. Organizations will announce the discontinuance of...

8. Should public employees have the same right to strike as private-sector employees are granted under the Labor Management Relations Act? Why or why not?

1. Was Williams entitled to have a witness at the meeting with Harless, Gray, and Fisher? Explain. TerryWilliams is an employee at a unionized plant in Memphis, Tennessee. Williams is a member of and...

4. What proof does the Company have that the Grievant did what he was accused of? On March 27, 1998, the Company, the Union, and Mr. Danny Webb, the Grievant, entered into and signed the following...