A firm's current profits...

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Question

A firm's current profits are $750,000. These profits are expected to grow indefinitely at a constant annual rate of 5 percent. If the firm's opportunity cost of funds is 8.5 percent, determine the value of the firm: Round your responses to 2 decimal places - in million
a. The instant before it pays out current profits as dividends
b. The instant after it pays out current profits as dividends.Level of Detail: Only answer needed
Other Requirements: For some reason numbers just not working out for me. Should take maximum 5 minutes to do with example attached

 

Solution ID:351109 | This paper was updated on 26-Nov-2015

Price : $25
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