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Marko, Inc. is considering the purchase of ABC Company. Marko believes that ABC Co. can generate cash flows of $6,000, $9,000, and $16,000 over the
Marko, Inc. is considering the purchase of ABC Company. Marko believes that ABC Co. can generate cash flows of $6,000, $9,000, and $16,000 over the next three years, respectively. After that time, management feels ABC will be worthless. Marko has determined that a 14% rate of return is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.? Select one: a. $22,987.91 b. $21,435.74 c. $31,758.00 d. $19,201.76 e. $27,808.17
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