1. Answer the following questions about the APV and WACC model based on this spreed sheet:

• What are the main assumptions underlying the two models?
• What can explain the difference in the valuations we intitially obtained from the two alternative methods?
• When is most appropriate to use one method or the other
• 

2022 $ 22,152.37 $ (6,645.71)| $ $ 15,506.66 $ $ (8,190.00)| $ $ 23,696.66 $ $ 1,510.71 $ $ 21,840.00 $ $ 345.95 $ $ 906.99 $ $ (272.10) $ $ (288.94) $ V W W W W W W W W P 346 272 272 Ebit Taxes NOPAT Depreciation OCF WC CAPEX FCF debt service t*interst FCFE Terminal Value DCF to the firm Interest Tax Shield Termina Value of Interest Tax shield DCF of Interest Tax Shield Terminal value ka DCF Total ku Equity Value ku DCF Total kd Equity Value ka Debt Assts Cost of Debt ku WACC Termina Value Dcf or entreprise value Equity Entrerprise Value beggining year Beggining Tax Shields Beggining FFCF Debt Equity Debt/ Entrerprise Value Debt/Equity ke kd Adjusted WACC 2023 2024 2025 Total 26,960.52 $ 31,475.53 $ 41,311.85 (8,088.16) $ 19,442.66) $ (12,393.55) 18,872.37 $ 22,032.87 $ 28,918.29 (9,418.50) $ (10,360.35) $ (10,878.37) 28,290.87 $ 32,393.22 $ 39,796.66 1,735.00 $ 1,568.36 $ 2,975.94 21,703.50 $ 19,778.85$ 16,058.54 4,852.37$ 11,046,01$ 20,762.18 4,720.35 $ 6,624.51 $ 14,510.18 (301.73) $ (257.15) $ (187.94) 433.75$ 4,678.66 $ 6,439.94 279,597 4,852 11,046 300,359 229,820.41 302 C 257 188 2,531 302 257 2,719 2,670.31 6,338.56 232,490.71 209,815.96 236,158.97 213,484.22 20% 20% 20% 20% 4% 4% 4% 8.50% 8.50% 8.50% 8.50% 9.63% 8.26% 288,840.18 309,602.36 225,388.72 202,713.97 255,329.20 271,593.69 283,093.78 6,320 6,271 6,265 249,009.19 265,322.60 276,829.01 25,144 21,429 15,662 230,185.33 250,164.41 267,431.84 9.8% 7.9% 5.5% 0.11 0.09 0.06 8.84% 8.77% 8.68% 4% 4% 4% 8.25% 8.30% 8.36% 20% 4% 8.50% 236,158.97 6,339 229,820.41 22,675 213,484.22 9.6% 0.11 8.83% 4% 8.26% FCFF 345.95 4,852.37 11,046.01 Terminal Vaue Adjusted WACC 20,762.18 284,957.41 305,719.59 222, 311.99 waccadist 319.57 4,140.78 8,703.82