Q29)

Suppose the risk-free rate is 2.22% and an analyst assumes a market risk premium of 7.77%. Firm A just paid a dividend of $1.23 per share. The analyst estimates the of Firm A to be 1.29 and estimates the dividend growth rate to be 4.74% forever. Firm A has 251.00 million shares outstanding. Firm B just paid a dividend of $1.71 per share. The analyst estimates the of Firm B to be 0.77 and believes that dividends will grow at 2.05% forever. Firm B has 195.00 million shares outstanding. What is the value of Firm A?

Q31) Caspian Sea Drinks is considering buying the J-Mix 2000. It will allow them to make and sell more product. The machine cost $1.12 million and create incremental cash flows of $878,682.00 each year for the next five years. The cost of capital is 11.29%. What is the net present value of the J-Mix 2000?