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Cash Flow Years 1-3: SO Cash Flow Year 4: $5,000,000 Cash Flow Year 5: $8,000,000 Cash Flow Year 6: $10,000,000 (this is also the terminal
Cash Flow Years 1-3: SO Cash Flow Year 4: $5,000,000 Cash Flow Year 5: $8,000,000 Cash Flow Year 6: $10,000,000 (this is also the terminal year) You are seeking a 35% return on your investment with a 5 year investment window. Discount Rate: 15% Growth Rate: 5% Using the discounted cash flow method, what is the present value of this company? If you are making an investment of $7,000,000, what percentage of the company will you receive in ownership in exchange for your investment? Cash Flow Years 1-3: SO Cash Flow Year 4: $5,000,000 Cash Flow Year 5: $8,000,000 Cash Flow Year 6: $10,000,000 (this is also the terminal year) You are seeking a 35% return on your investment with a 5 year investment window. Discount Rate: 15% Growth Rate: 5% Using the discounted cash flow method, what is the present value of this company? If you are making an investment of $7,000,000, what percentage of the company will you receive in ownership in exchange for your investment
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