Use Next Year's Cash Flow Forecast for Blank Company to Answer

question 51

Multiple Choice

Use next year's Cash Flow Forecast for Blank Company to answer the following questions:
$\begin{array} { | l | l | } \hline \text { Demand } & \text { Cash Flow } \\\hline \text { Weak } & \$ 25,000 \\\hline \text { Expected } & \$ 35,000 \\\hline \text { Strong } & \$ 45,000 \\\hline\end{array}$
-Suppose Blank Company has only one project, as forecast above, and an unlevered cost of equity of 8%. What is the value of the company?

• A) $32,407.40
• B) $41,666.67
• C) $23,148.15
• D) cannot be determined with the information given

---

Definitions:

Barry Goldwater

A significant figure in American politics, known for his 1964 presidential campaign and as a major proponent of conservatism in the United States.

Initiative

A process or strategy intended to resolve an issue or create change.

Reluctant

Feeling or showing hesitation or unwillingness to do something.

Empower Children

A process of supporting and encouraging children to gain control over their lives, make decisions, and grow in confidence.