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17-2: The Modigliani and Miller Models and the Compressed Adjusted Present Value (APV) Mode Problem 17 Compressed APV with Nonconstant Growth Sheldon or orat projects
17-2: The Modigliani and Miller Models and the Compressed Adjusted Present Value (APV) Mode Problem 17 Compressed APV with Nonconstant Growth Sheldon or orat projects the following ree cash ows F Fs and interest expenses or the next 3 years, after 40%. -12 ich FCF and interest expenses are expected to gra w at a constant 7% rate. Sheldon's une ered cost of e uty is its tax rate is Free cash flow ( millions) Interest expense (s millions) $20 $30 $40 $8 $9 $10 a. What is Sheldon's unlevered horizon value of operations at Year 3? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answer to two decimal places. b. What is the current unlevered value of operations? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answer to two decimal places. c. What is horizon value of the tax shield at Yeor 3? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do nat round intermediate calculations. Round your answer to two decimal places d. What is the current value of the tax shield? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answer to two decimal places e. What is the current total value of the company? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answar to two docimal places million million
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