5.6 Capital invested amounts to $100, ROC = 10%, and WACC = 15%. ROC will remain at...

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5.6 Capital invested amounts to $100, ROC = 10%, and WACC = 15%. ROC will remain at 10% during the next 5 years; afterwards it will increase to 15%, and it will stay at that level. The firm is expected to grow at 5% per year throughout. The firm has received an acquisition offer of $50 million for the enterprise free of debt. What would you recommend to its stockholders?

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