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Year 0 1 Revenue 600.00 Fixed costs 100.00 Variable costs 200.00 Additional investment in NWC 10.00 Additional investment in operating long-term assets 70.00 Depreciation 60.00
Year | 0 | 1 | |
Revenue | 600.00 | ||
Fixed costs | 100.00 | ||
Variable costs | 200.00 | ||
Additional investment in NWC | 10.00 | ||
Additional investment in operating long-term assets | 70.00 | ||
Depreciation | 60.00 | ||
Interest expenses | 35.00 | ||
Newly issued debt | 25.00 | ||
Principle repayments | 15.00 | ||
Tax rate | 0.40 | ||
Market value of the firm: | |||
Price per share | No. of shares | Market value | |
Short-term debt | 100.00 | ||
Long-term debt | 600.00 | ||
Preferred stock | 10.00 | 10 | 100.00 |
Common stock, equity | 18.00 | 100 | 1,800.00 |
Total | 2,600.00 | ||
Cost of equity (Rs) | 0.1500 |
Growth rate per year from year 1 through year 5 | 0.10 |
Growth rate after year 5 | 0.07 |
What is the price per share according to the equity free cash flow model?
Select one:
a. $18.29
b. $10.98
c. $15.51
d. $20.87
e. $12.33
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