1. Using one relevant valuation method (Valuation by comparable or free cash flow) introduced in topic 3 of this subject, calculate the theoretical price of each FAANG stock. Explain the method chosen for the calculations, critically discussing the assumptions and validity of your result.

Old Equipment New Equipment Current book value $400,000 Current market value $600,000 Acquisition cost $1,000,000 Remaining life (years) 10 Life (years) 10 Associated annual sales $300,000 Associated annual sales $450,000 Associated operating expenses $120,000 Associated operating expenses $150,000 Annual depreciation $40,000 Annual depreciation $100,000 Accounting salvage value $0 Accounting salvage value $0 Expected salvage value $100,000 Expected salvage value $200,000 Old Equipment New Equipment Current book value $400,000 Current market value $600,000 Acquisition cost $1,000,000 Remaining life (years) 10 Life (years) 10 Associated annual sales $300,000 Associated annual sales $450,000 Associated operating expenses $120,000 Associated operating expenses $150,000 Annual depreciation $40,000 Annual depreciation $100,000 Accounting salvage value $0 Accounting salvage value $0 Expected salvage value $100,000 Expected salvage value $200,000