Assume that the company had a historical growth rate of 3


Analysts often value companies by forecasting a series of cash flows and then estimating a horizon value. Suppose a firm forecasts a project's net cash flows ($millions) in years 1 through 4 as $120, $130, $135, and $137, respectively. If the project ends at the end of the fourth year, what is the horizon value of the project? Assume that the company had a historical growth rate of 3 percent and has a discount rate of 10 percent.

Solution Preview :

Prepared by a verified Expert
Basic Statistics: Assume that the company had a historical growth rate of 3
Reference No:- TGS02794762

Now Priced at $10 (50% Discount)

Recommended (90%)

Rated (4.3/5)