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Elementary,Middle School,High School,College,University,PHD
Teaching Since: | Apr 2017 |
Last Sign in: | 328 Weeks Ago, 2 Days Ago |
Questions Answered: | 3232 |
Tutorials Posted: | 3232 |
MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
Your firm just finished the year, in which it had cash earnings of $400 (thousand). You forecast your firm to have a quick growth phase from year 0 to year 5, in which it grows at a rate of 40% per annum. Your firm’s growth then slows down to 20% per annum, from year 5 to year 10. Finally, beginning in year 11, you expect the firm to settle into its long-term growth rate of 2% per annum. You also expect your cost of capital to be 15% over the first 5 years, then 10% over the next 5 years, and 8% thereafter. What do you think your firm is worth today? (Note: This problem is easiest to work in a computer spreadsheet.)
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