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answer You have the following information about the company C. Cost of capital = 10% The beginning book value = $60 m The earnings in
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You have the following information about the company C. Cost of capital = 10% The beginning book value = $60 m The earnings in year 2022 $20m The initial equity investment=S60m Year Dividends Free cash flows Abnormal earings Abnormal earnings Net profit to equity growth $40m $14m $20m 2022 $40m 2023 $50m $50m $26m $20 m 330m 2024 360m $80m $38m S12m $40m 2025 NA NA INA $38m NA As a financial analyst you are asked to 1. Compute the present value factor for the years 2022 2023 2024 [2 marks 2. Compute the equity value of the company C using 3 different approaches. (12 marks] For the toolbar, press ALT+F10 (PC) or ALT-FN-F10 (Mac) You have the following information about the company C. Cost of capital = 10% The beginning book value = $60 m The earnings in year 2022 $20m The initial equity investment=S60m Year Dividends Free cash flows Abnormal earings Abnormal earnings Net profit to equity growth $40m $14m $20m 2022 $40m 2023 $50m $50m $26m $20 m 330m 2024 360m $80m $38m S12m $40m 2025 NA NA INA $38m NA As a financial analyst you are asked to 1. Compute the present value factor for the years 2022 2023 2024 [2 marks 2. Compute the equity value of the company C using 3 different approaches. (12 marks] For the toolbar, press ALT+F10 (PC) or ALT-FN-F10 (Mac) Step by Step Solution
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