A retail coffee company is planning to open 110 new coffee outlets that are expected to generate $15.9 million in free cash flows per year, with a growth rate of 2.8% in perpetuity. If the coffee company's WACC is 9.5%, what is the NPV of this expansion? The present value of the free cash flows is $ million. (Round to two decimal places.)
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- A retail coffee company is planning to open 105 new coffee outlets that are expected to generate $13.6million in free cash flows per year, with a growth rate of 2.8% in perpetuity. If the coffee company's WACC is 10.1%,what is the NPV of this expansion?A retail coffee company is planning to open new coffee 95 outlets that are expected to generate $13.3 million in free cash flows per year, with a growth rate of 3.3% in perpetuity. If the coffee company's WACC is 10.6%, what is the NPV of this expansion?Golf Ball Inc. expects earnings to be $10,000 per year in perpetuity if it pays out all of its earnings in dividends. Suppose the firm has an opportunity to invest $1,000 of next year's earnings to upgrade its machinery. It is expected that this upgrade will increase earnings in all future years (starting two years from now) by $140. Assume that Golf Ball's next dividend is one year from now. The required rate of return is 12%. What is the value of Golf Ball Inc. if it undertakes the upgrade?
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