A firm's current profits are $950,000. These profits are
expected to grow indefinitely at a constant annual rate of 6
percent. If the firm's opportunity cost of funds is 8 percent,
determine the value of the firm:
Instructions: Enter your
responses rounded to two decimal places.
a. The instant before it pays out current profits as
dividends.
$ million
b. The instant after it pays out current profits as
dividends.
$ million
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