Exhibit 13 From Year 2013 Onward Growth in FCFE Is Expected to

question 81

Multiple Choice

Exhibit 13.2
Use the Information Below for the Following Problem(S)
At the end of the year 2004 the Office Equipment Industry had free cash flow to equity (FCFE) of $2.50 per share. The following annual growth rates in FCFE are projected:
$$\begin{array} { c c } \text { Year } & \text { Grapth Rata } \\\hline 2005 & 10 \% \\2006 & 15 \% \\2007 & 20 \% \\2008 & 25 \% \\2009 & 20 \% \\2010 & 15 \% \\2011 & 10 \% \\2012 & 7 \%\end{array}$$
From year 2013 onward growth in FCFE is expected to remain constant at 5% per year. The industry has a beta of 0.90 and the current industry price is $105. Currently the yield on 10-year Treasury notes is 5% and the equity risk premium is 4%
-Refer to Exhibit 13.2.Calculate the present value now (Year 2004) of FCFE during the period of constant growth (that is for years 2013 onwards) .

• A) $116.15
• B) $97.03
• C) $155.58
• D) $89.86
• E) $67.89

Differentiate between normal and pathological fears and the importance of a dimensional approach in diagnosis.

Understand the application and interpretation of the Wilcoxon signed rank test for paired data analysis.

Comprehend the principles underlying the Wilcoxon rank sum test for comparing two independent samples.

Interpret the results and implications of non-parametric hypothesis testing.

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Definitions:

Operational

Pertains to the day-to-day activities and tasks necessary for running a business or organization, focusing on efficiency and effectiveness.

Top Supply Position

A strategic role or status achieved by being among the best suppliers in terms of reliability, quality, and competitiveness.

Supply Function

An economic principle describing the relationship between the price of a good and the quantity supplied, assuming other factors remain constant.

Organizational Goals

Objectives or targets set by an organization that guide its strategy, operations, and endeavors towards achievement.