Use the Following Information to Answer the Question(s)below

question 84

Multiple Choice

Use the following information to answer the question(s) below.
Galt Industries is expected to generate free cash flows of $24 million per year.Galt has permanent debt of $80 million,a corporate tax rate of 40%,and an unlevered cost of capital of 12% and its cost of debt capital is 6%.
-The value of Galt's equity using the APV method is closest to:

• A)$150 million
• B)$180 million
• C)$230 million
• D)$240 million

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Definitions:

Disjunctive Task

A task in which the performance of the group is determined by the best individual performance among its members.

Steiner's Taxonomy

A classification system developed by Ivan Steiner that categorizes group tasks based on their nature and the ways individuals contribute to group performance.

Coordination Loss

Deterioration in group performance compared with individual performance, due to problems in coordinating behaviour.

Motivation Loss

The reduction in the drive or willingness to engage in an activity, often leading to decreased effort and performance.