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The weighted average cost of capital of ABC Corp based on market values is 15.6% while its cost of ordinary shares is 21.0%. It has
- The weighted average cost of capital of ABC Corp based on market values is 15.6% while its cost of ordinary shares is 21.0%. It has a long-term debt to equity ratio of 150%. The expected total dividends for the year is P3,400,000 and the growth rate of the share value is 4%.
REQUIRED:- 1. EQUITY VALUE
- 2. FIRM VALUE
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There are 3 Steps involved in it
Step: 1
1 Equity value To calculate the equity value we can use the dividend discount model DDM formula which is as follows Equity value Expected total divide...
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Step: 2
Step: 3
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Financial Management Theory and Practice
Authors: Eugene F. Brigham, Michael C. Ehrhardt
15th edition
130563229X, 978-1305632301, 1305632303, 978-0357685877, 978-1305886902, 1305886909, 978-1305632295
