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TL Enterprises (TLE)is Considering Purchasing DMM

Question 101

Multiple Choice

TL Enterprises (TLE) is considering purchasing DMM.DMM has expected cash flows of $42,800,$56,700,and $37,100 for the next 3 years,respectively.After that,the products DMM produces will be obsolete and thus DMM will be worthless.If TLE requires a return of 18 percent,what amount should they offer as a purchase price?


A) $87,141.41
B) $102,247.79
C) $85,868.09
D) $91,216.57
E) $99,572.45

Correct Answer:

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