Swedish Imports Is an Unlevered Firm with an After-Tax Net

question 41

Multiple Choice

Swedish Imports is an unlevered firm with an after-tax net income of $79,000. The unlevered cost of capital is 12% and the tax rate is 35%. What is the value of this firm?

• A) $427,916
• B) $514,250
• C) $579,333
• D) $611,407
• E) $658,333

---

Definitions:

Sales

The activities involved in selling goods or services to customers, including the negotiation of price and delivery terms.

Profits

The financial gain obtained when the revenue from business activities exceeds the expenses, costs, and taxes involved in maintaining the activity.

Forbes 500

An annual listing published by Forbes magazine ranking the top 500 publicly traded companies in the United States based on their revenue.

Regression

A statistical method used to model the relationship between a dependent variable and one or more independent variables.