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A business has a current cash flow of sh 400,000. Currently, its cost of capital is estimated at 10%. Required a) Assuming it will generate
A business has a current cash flow of sh 400,000. Currently, its cost of capital is estimated at 10%. Required a) Assuming it will generate these cash flows every year till infinity, how much is it worth today. b) Assume the cash flows will grow at 8% in the first 4 years and stabilize at 5% from year five on wards. Calculate the value of the business today if return required by investors today is 12%
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