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Use Next Year's Cash Flow Forecast for Blank Company to Answer

Question 51

Multiple Choice

Use next year's Cash Flow Forecast for Blank Company to answer the following questions:
 Demand  Cash Flow  Weak $25,000 Expected $35,000 Strong $45,000\begin{array} { | l | l | } \hline \text { Demand } & \text { Cash Flow } \\\hline \text { Weak } & \$ 25,000 \\\hline \text { Expected } & \$ 35,000 \\\hline \text { Strong } & \$ 45,000 \\\hline\end{array}
-Suppose Blank Company has only one project, as forecast above, and an unlevered cost of equity of 8%. What is the value of the company?


A) $32,407.40
B) $41,666.67
C) $23,148.15
D) cannot be determined with the information given

Correct Answer:

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