c. Amazon had net operating profit after tax (NOPAT) amounted to $18.5 million in the year just ended, and it believes that it will experience a multi-stage growth in its NOPAT due to unstable market condition. According to its forecasts, NOPAT will grow by 8% per year for the first three years, then 6.5% per year for the next 2 years and finally 5% per year forever. To maintain such growth, Amazon will need to make long-term and short-term investment in next 5 years, in addition to its current long-term investment of $2.90m and short-term investment of $0.75m. The expected net investments in Plant, Property & Equipment are $3m., S4 25m. $4.50m, $5.30m and $5.50m during the next 5 years. Moreover, it expects a series of investments in working capital ($0.92m, $1.08m. $1.19m, $1.53m & $ 1.75m) in next 5 years. The change in net working capital was $.012m in the year just ended. The book value of equity and debt are $120 million and $40m respectively. The firm has cash of S10m and the number of outstanding shares is 5m. Its systematic risk is 1.75 when measured against American market. The dollar-risk free rate is 4% and the return in the American stock market is 10%. Amazon's pretax borrowing cost in New York on new long- term dollar-denominated debt is 7%. Interest payments are tax deductible in USA at the marginal corporate tax rate of 21%. According to Economic Value Added method, what is the maximum price you will offer to buy Amazon's stock? c. Amazon had net operating profit after tax (NOPAT) amounted to $18.5 million in the year just ended, and it believes that it will experience a multi-stage growth in its NOPAT due to unstable market condition. According to its forecasts, NOPAT will grow by 8% per year for the first three years, then 6.5% per year for the next 2 years and finally 5% per year forever. To maintain such growth, Amazon will need to make long-term and short-term investment in next 5 years, in addition to its current long-term investment of $2.90m and short-term investment of $0.75m. The expected net investments in Plant, Property & Equipment are $3m., S4 25m. $4.50m, $5.30m and $5.50m during the next 5 years. Moreover, it expects a series of investments in working capital ($0.92m, $1.08m. $1.19m, $1.53m & $ 1.75m) in next 5 years. The change in net working capital was $.012m in the year just ended. The book value of equity and debt are $120 million and $40m respectively. The firm has cash of S10m and the number of outstanding shares is 5m. Its systematic risk is 1.75 when measured against American market. The dollar-risk free rate is 4% and the return in the American stock market is 10%. Amazon's pretax borrowing cost in New York on new long- term dollar-denominated debt is 7%. Interest payments are tax deductible in USA at the marginal corporate tax rate of 21%. According to Economic Value Added method, what is the maximum price you will offer to buy Amazon's stock