Question
You are an analyst at Dewey, Cheatum, and Howe. A mutual fund manager presents the following free cash flow data for XYZ Corp (in millions
You are an analyst at Dewey, Cheatum, and Howe. A mutual fund manager presents the following free cash flow data for XYZ Corp (in millions of $). (15 Points) Year Cash Flow 1996 400 1997 200 1998 300 1999 200 2000 600 2001 100 2002 500 2003 600 2004 700 2005 800 She asks you to please calculate the: Geometric Total Return Geometric Annualized Return Then, the mutual fund manager asks you to make a 10 year forecast based upon the geometric annualized return. Finally, she asks you to calculate the present value of the forecasted cash flows assuming a weighted average cost of capital of 8%.
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