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What is the Max Purchase price? Also, please ignore typo in yellow ? In year 3, the estimated relevant annual expected cash flows represents funds
What is the Max Purchase price? Also, please ignore typo in yellow?
In year 3, the estimated relevant annual expected cash flows represents funds used to pay operating expenses for subsequent years. All estimated relevant annual expected cash flows include a risk premium of 13 percent, which has already been applied to the cash flows above. Solve for PV of cash flow for Year 1 based on your answer in Question 2. Then, solve for present value (PV) for Year 1. What is the maximum price that should be paid for the factory? Problem 3 Numerical Calculations: 393,000 327,000 291,000 202,083 $ 191,000 $ 110,532 306,000 147,569 Total 424,000 $ 1,605,000 170,396 $ 957,580 Answer. NPV
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