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Gordon's Reproductions posted the following results in 2 0 2 1 and projected results through 2 0 2 6 . Gordon Green, the owner, wants
Gordon's Reproductions posted the following results in and projected results through Gordon Green, the owner, wants to
retire between now and the end of Assume a discount rate of percent from now until dropping to thereafter. The
company is expected to grow at per year after A Calculate the net present value of the free cash flow for the end of the year in B: gordon has been told that the Price Earnings ratio for his type of business is Compute the price earnings ratio for current earnings. Then compute the Price Earnings ratio if he waited until to sell the business. Discount the value back to and compare the results. C: Gordon owns of the stock. Assuming that he arranges to sell the business for the highest valuation. What would he receive at the end of and what would the investors receive. How much would he receive if he waited until to sell the business? D: Gordon started the business in with an investment of $ In he accepted an investment of $ from an angel investor group. They received of the stock in return for their investment. If he waits until to sell and uses the highest valuation, what will his internal rate of return be What will the internal rate of return be for his investors?
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