Use the Table for the Question(s)below

question 29

Multiple Choice

Use the table for the question(s) below.
-Banco Industries expect sales to grow at a rapid rate over the next 3 years,but settle to an industry growth rate of 5% in year 4.The spreadsheet above shows a simplified pro forma for Banco Industries.Banco industries has a weighted average cost of capital of 12%,$50 million in cash,$60 million in debt,and 18 million shares outstanding.If Banco Industries can reduce their operating expenses so that EBIT becomes 12% of sales,by how much will their stock price increase?

• A)$2.81
• B)$3.36
• C)$4.98
• D)$8.89

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A check that is presented for payment more than six months after its date.

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A federal regulation that governs the availability of funds and collection of checks in the United States.

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Money placed into a bank account or financial institution for safekeeping and potential interest accumulation.

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