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Squirrel Spring Water, Inc., expects to sell 2.97 million bottles of drinking water each year in perpetuity. This year, each bottle will sell for $2.10
Squirrel Spring Water, Inc., expects to sell 2.97 million bottles of drinking water each year in perpetuity. This year, each bottle will sell for $2.10 in real terms and will cost $1.07 in real terms. Sales income and costs occur at year-end. Revenues will rise at a real rate of 5 percent annually, while real costs will rise at a real rate of 4 percent annually. The real discount rate is 14 percent. The corporate tax rate is 22 percent. |
What is the company worth today? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234,567.89.) |
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