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Excel with formula's please. Thank you very much. Intro It is December 2019. Google has offered to buy your internet startup. The Google negotiators and
Excel with formula's please. Thank you very much.
Intro It is December 2019. Google has offered to buy your internet startup. The Google negotiators and you both agree on the following expectations Expected cash flow Year (end of year) 2020 2021 2022 2023 2024 120,000 180,000 270,000 360,000 450,000 After 2024, cash flows are expected to grow by 2% per year. Based on the riskiness of your industry, you think that your weighted average cost of capital is 15%. You have bank loans worth $400,000 outstanding What is the terminal value, i.e., the present value of all free cash flows from 2025 to infinity expressed in 2024-dollars? Correct Since we are only given the free cash flows for the next five years, we need to find the terminalvalue, i.e., the present value of all free cash flows from years 2024 to itimiy C F2,025 ,024-1+WACC T (1 + WACC)2 We can use the formula from the Gordon dividend model to find the (2023) present value CF202419) 450,000 (1+0.02) 0.15 0.02 - 3,530,769Step by Step Solution
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