A dry cleaning store is expected to make annual cash flows forever. The cost of capital for the store is 14.33 percent. The next annual cash flow is expected in one year from today and all subsequent cash flows are expected to grow annually by 3.35 percent. What is the value of the dry cleaning store if the cash flow in 5 years from today is expected to be $243,000.00? O $1,486,339.98 (plus or minus 10 dollars) O $1,939,822.58 (plus or minus 10 dollars) O $1,132,929.58 (plus or minus 10 dollars) O $2,213,114.75 (plus or minus 10 dollars) O $1,695,743.20 (plus or minus 10 dollars)
A dry cleaning store is expected to make annual cash flows forever. The cost of capital for the store is 14.33 percent. The next annual cash flow is expected in one year from today and all subsequent cash flows are expected to grow annually by 3.35 percent. What is the value of the dry cleaning store if the cash flow in 5 years from today is expected to be $243,000.00? O $1,486,339.98 (plus or minus 10 dollars) O $1,939,822.58 (plus or minus 10 dollars) O $1,132,929.58 (plus or minus 10 dollars) O $2,213,114.75 (plus or minus 10 dollars) O $1,695,743.20 (plus or minus 10 dollars)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
Section: Chapter Questions
Problem 22E
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