What is the projected growth rate for the 10-year period?

QUESTION 2: If your required return on investment is 12%, how much will be the INTRINSIC Value of U-GANDA Corporation?

QUESTION 3: If your required return on investment is 12%, would you purchase the shares of U-GANDA Corporation? Substantiate your answer.

 

You are evaluating U-GANDA Corporation based on the following projected cash flows for the next 10 years: Year 1 2 3 4 5 Cash flows 1,000,000 1,000,000 1,150,000 1,200,000 1,200,000 Year 6 7 8 9 10 Cash flows 1,300,000 1,500,000 1,700,000 2,000,000 2,200,000 After year 10, the cash flows are expected to grow at a rate based on the 10-year period. The company have 1 million outstanding shares and is currently selling on the stock market at P30 per share. The company's outstanding debts amounted to P3,000,000.