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Mr . ABC the owner of an automotive manufacturing company expects to make a 3 0 0 M profit on the first year and 3

.

ABC the owner of an automotive manufacturing company expects to make a

300 M

profit on the first year and

320 M

in the second year. He decided to sell the firm at the end of the second year for

400 M .

He believes that the appropriate discount rate us

20 % .

Calculate the value of the firm and what is the decision of the owner?

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