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Elizabeth Islands Airways (ticker: EIA), a small, regional airline serving the New England area, recently suffered a major crash. As a result, passengers are considered
Elizabeth Islands Airways (ticker: EIA), a small, regional airline serving the New England area, recently suffered a major crash. As a result, passengers are considered to be less likely to choose EIA as their air carrier when making travel plans. You expect that free cash flows will fall by $17 million per year for five years, after which you anticipate that business will return to normal. If EIA has 65 million shares outstanding, an equity cost of capital of 8%, and no debt, by how much would one share of EIA stock be expected to fall in price as a result of this accident? O A. $1.36 OB. $1.15 OC. $0.94 OD. $1.04
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