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Basic Question 0 of 11
After evaluating Dell Software's financial statements, you conclude that the company has FCFF of $2.8 million. You expect its FCFF to grow forever at 8%. Additional information:
- DS's WACC: 12%.
- Required rate of return on its equity: 15%.
- Outstanding debt: $25 million.
The total value of DS' equity is ______.
User Contributed Comments 4
| User | Comment |
|---|---|
| danlan2 | WACC is for FCFF, required rate of return is for dividend. |
| ssradja | don't forget to calculate next period FCFF |
| Lavay | Required return is also for FCFE. |
| Manasseh | Required rate of return is not needed to answer this question |
I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
evaluate how well a multiple regression model explains the dependent variable by analyzing ANOVA table results and measures of goodness of fit;
CFA® 2025 Level II Curriculum, Volume 1, Module 2.