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MercedesF1 has an ROC of 15%, debt-equity ratio of 1:5, after-tax cost of debt of 6%, cost of equity of 14%, a reinvestment rate of
MercedesF1 has an ROC of 15%, debt-equity ratio of 1:5, after-tax cost of debt of 6%, cost of equity of 14%, a reinvestment rate of 70% and an after-tax operating margin of 14%. The marginal corporate income tax rate is 25%. Based on a single-stage FCFF valuation model of this firm, determine what the following value multiples for this company will be equal to: a) FCFF1EV= b) BVofCapEV= c) SalesEV= d) EBITEV= e) EBIT(1t)EV=
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