You are given the following forecasted information for the year 2008: Sales = $300,000,000; Operating profitability (OP)

Question:

You are given the following forecasted information for the year 2008: Sales = $300,000,000; Operating profitability (OP) = 6%; Capital requirements (CR) = 43%; Growth (g) = 5%; and the weighted average cost of capital (WACC) = 9.8%. If these values remain constant, what is the horizon value (that is, the 2008 value of operations)?

Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...