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KFS has two divisions. Both have current sales of $1, 000, current expected growth of 5%, and a WACC of 10%. Division A has high
KFS has two divisions. Both have current sales of $1, 000, current expected growth of 5%, and a WACC of 10%. Division A has high profitability (OP = 6%) but high capital requirements (CR = 78%). Division B has low profitability (op = 4%) but low capital requirements (CR = 27%). Given growth rate of 5%, determine the intrinsic MVA of each division. K) What is the EROIC of each division for 5% growth and 6% growth? How is this related to intrinsic MVA
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