Question
Please explain your answer. Consider the following data with regards to free cash flow (FCF): Revenue = $100,000 Cash operating expenses = $93,500 Depreciation expense
Please explain your answer.
Consider the following data with regards to free cash flow (FCF):
- Revenue = $100,000
- Cash operating expenses = $93,500
- Depreciation expense = $1,000
- Effective tax rate = 25%
- Incremental investment in operating net working capital = $50
- Incremental investment in long-term operating assets = $4,000
If depreciation expense was to decrease by 10% but everything else remains as shown above, how much would free cash flow change? Assume no other factors change.
Enter your answer as a monetary amount rounded to four decimal places, but without the currency symbol. For example, if your answer is $90.1234, enter 90.1234. If your result shows a decrease, enter a negative figure.
2. Consider the following data with regards to free cash flow (FCF):
- Revenue = $100,000
- Cash operating expenses = $93,500
- Depreciation expense = $1,000
- Effective tax rate = 25%
- Incremental investment in operating net working capital = $50
- Incremental investment in long-term operating assets = $4,000
If cash operating expenses were to increase by 10% but everything else remains as shown above, how much would free cash flow change? Assume no other factors change.
Enter your answer as a monetary amount rounded to four decimal places, but without the currency symbol. For example, if your answer is $90.1234, enter 90.1234. If your result shows a decrease, enter a negative figure.
3. Consider the following data with regards to free cash flow (FCF):
- Revenue = $100,000
- Cash operating expenses = $93,500
- Depreciation expense = $1,000
- Effective tax rate = 25%
- Incremental investment in operating net working capital = $50
- Incremental investment in long-term operating assets = $4,000
If revenue were to decrease by 10% but everything else remains as shown above, how much would free cash flow change? Assume no other factors change.
Enter your answer as a monetary amount rounded to four decimal places, but without the currency symbol. For example, if your answer is $90.1234, enter 90.1234. If your result shows a decrease, enter a negative figure.
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