Recalculate the intrinsic value of Honda shares using the free cash flow model of Spreadsheet 13.2 (available

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Recalculate the intrinsic value of Honda shares using the free cash flow model of Spreadsheet 13.2 (available at www.mhhe.com/bkm; link to Chapter 13 material). Treat each scenario independently.

a. Honda’s P/E ratio starting in 2012 will be 12.5.

b. Honda’s unlevered beta is .9.

c. The market risk premium is 8.5%.

Challenge LO.1

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Essentials Of Investments

ISBN: 9780697789945

8th Edition

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

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