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Calculate the current market value of the factory

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A factory will generate an expected cash flow of $650,000 one year from now. After that, yearly expected cash flows from the factory will grow by 4% per year in perpetuity. The OCC for these cash flows is 11%.

a.Calculate the current market value of the factory.
b.Calculate the expected market value of the factory six years from now.
c.Calculate the growth rate of the expected market value.

 

Reference no: EM13266299

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