Question
Zeta Technologies has the following projections. It has no non-operating assets. Calculate Zeta's intrinsic value of equity using the FCFE model. Current year Year 1
Zeta Technologies has the following projections. It has no non-operating assets. Calculate Zeta's intrinsic value of equity using the FCFE model.
| Current year | Year 1 | Year 1 | Year 3 | |
| FCF | NA | 1,000 | 1,200 | 1,248 |
| Total debt | 3,000 | 3,900 | 4,290 | 4,462 |
| Interest rate on debt | 6% | 6% | 6% | 6% |
| Tax rate | 25% | 25% | 25% | 25% |
| Long-term growth rate | 4% | |||
| Required return on equity | 9% |
| a. | $21,165 | |
| b. | $28,171 | |
| c. | $23,282 | |
| d. | $30,988 | |
| e. | $25,610 |
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Gapenskis Fundamentals Of Healthcare Finance
Authors: Paula H. Song, Kristin L. Reiter
3rd Edition
1567939759, 978-1567939750
