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The last person that answered this question was incorrect. Someone please help I have tired so many times lol! You need to estimate the value
The last person that answered this question was incorrect. Someone please help I have tired so many times lol!
You need to estimate the value of Laputa Aviation. You have the following forecasts (in millions of dollars) of its profits and of its future nvestments in new plant and working capital: From year 5 onward, EBITDA, depreciation, and investment are expected to remain unchanged at year-4 levels. Laputa is financed 60% by equity and 40% by debt. Its cost of equity is 20%, its debt yields 6%, and it pays corporate tax at 30%. a. Estimate the company's total value. Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amount. b. What is the value of Laputa's equity? Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amountStep by Step Solution
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