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ghanim1963
22.04.2020 •
Business
Ankh-Sto Associates Co. is expected to generate a free cash flow (FCF) of $14,835.00 million this year ( FCF1 = $14,835.00 million), and the FCF is expected to grow at a rate of 25.00% over the following two years ( FCF 2 and FCF3 ). After the third year, however, the FCF is expected to grow at a constant rate of 3.90% per year, which will last forever ( FCF 4 ). Of Ankh-Sto Associates Co.’s weighted average cost of capital (WACC) is 11.70%, what is the current total firm value of Ankh-Sto Associates Co.
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Ответ:
Value of Ankh-So = $266,324.32 millions
Explanation:
The value of a firm can be derived as the present value of this free cash flow discounted at the weighted average cost of capital
Year workings Present Value (Millions)
1 14,835.00× 1.117^(-1) = 13,281.11
2 14,835.00× 1.25× 1.117^(-2)= 14,862.48
3 14,835.00× 1.25^2× 1.117^(-3)= 16,632.14
Year 4 and beyond
This will be done in two steps
PV in year 3
= 14,835.00× 1.25^2 × 1.039/(0.117-0.039)
= 308,765.32
PV in year 0
308,765.32 × 1.117^(-3) = 221,548.596
Value of Ankh-So
=13,281.11 + 14,862.48 + 16,632.14 + 221,548.596
= $266,324.32 millions
Ответ:
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Apple's targeted many different segments with their just one promotional campaign. They target every male and female who wanted to have cell phone and could afford higher prices. Moreover, they also targeted youngsters as well who wanted to have something different and creative in their life. Apple's campaign was quite cleverly designed and positioned. Apple got enormous success with the help of this campaign. Apple surpass Samsung quite easily in terms of sales. With the help of this example, we can easily and confidently say that different segments can be targeted even with one single product and promotional campaign, if executed effectively and efficiently.