For a given company,next year's NOPLAT is $50.For the foreseeable future,the growth rate will be 3 percent,the ROIC will be 12 percent,and the weighted average cost of capital (WACC )will be 10 percent.Using the key driver formula,calculate the value of the company.
A)$536
B)$1,667
C)$714
D)$500

Question

Quizplus · Accepted Answer

Explaination:Value = $50 * {1 – (3%/12%)}/(10% – 3%) = $535.71

For a Given Company,next Year's NOPLAT Is $50