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5A company is going through the bankruptcy proceedings. The trustee estimates the liquidation value of the company to be $5,022,040. Alternatively, a restructuring can provide
5A company is going through the bankruptcy proceedings. The trustee estimates the liquidation value of the company to be $5,022,040. Alternatively, a restructuring can provide a perpetual annual cash flow starting one year from now and growing at 4.48% per year. How much must be the minimum cash flow next year to warrant a reorganization of the firm if the discount rate is 15.18%?
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