1. Use the following information on Company Y for ultimately estimating the net present value of the expansionary investment and for answering the remaining questions.

   Consider the following forecasts for 2020-2024 of the Future Cash Flows, EBITDA and Future Interest Tax Shield for Company Y if the expansion were not to occur. Assume that the EBITDA Multiple for the industry Company Y belongs to is 9.

   Assume a discount factor of 8% for the Free Cash Flows and for the Continuation Value, and a discount factor of 5% for the Interest Tax Shield.

   Firm Value	2020	2021	2022	2023	2024
   Free Cash Flow of Firm	207,129,430	245,974,151	286,944,851	334,734,192	390,476,695
   EBITDA					680,061,374
   Interest Tax Shield	35,000	105,000	105,000	105,000	105,000

   . What is the Present Value (at December 2019) of the Free Cash Flows forecast for Corporation Y if the firm where not to do the expansion?

10 points

QUESTION 12

1. . What is the Present Value (at December 2019) of the Continuation Value forecast for Corporation Y if the firm where not to do the expansion?

10 points

QUESTION 13

1. . What is the estimated Firm Value (at December 2019) for Corporation Y if the firm where not to do the expansion?

10 points

QUESTION 14

1. . Considering that the Firm Value for Corporation Y (at December 2019) if the firm where to do the expansion is estimated at $5308180299. What is the Net Present Value of the investment expansion?

10 points

QUESTION 15

1. ". Answer True or False: According the NPV, Corporation Y should do the expansion."

   True

   False