Recalculate the intrinsic value of GE shares using the free cash flow model of Spreadsheet 18.2 (available

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Recalculate the intrinsic value of GE shares using the free cash flow model of Spreadsheet 18.2

(available in Connect; link to Chapter 18 material) under each of the following assumptions.

Treat each scenario independently.

a. GE’s P/E ratio starting in 2020 (cell G3) will be 16.

b. GE’s unlevered beta (cell B22) is 0.8.

c. The market risk premium (cell B27) is 7.5%.

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Investments

ISBN: 9781259277177

11th Edition

Authors: Zvi Bodie, Alex Kane, Alan J. Marcus

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Question Posted: Jul 24, 2024 05:04 AM

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Recalculate the intrinsic value of GE shares using the free cash flow model of Spreadsheet 18.2 (available

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Investments

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