Franklin Industries Has a Current Net Working Capital of $2

question 88

Multiple Choice

Franklin Industries has a current net working capital of $2.5 million.It expects that this will grow at a rate of 3.5% annually forever.If it could slow that growth to 3% per year,how would that affect the value of the firm,given that it has a cost of capital of 11%?

• A)a decrease of $2.22 million
• B)an increase of $12,500
• C)an increase of $0.78 million
• D)an increase of $2.08 million
• E)an increase of $3.14 million

---

Definitions:

Francis Hsu

An anthropologist recognized for his comparative studies on kinship, family structure, and filial piety in different cultures.

Core Values

Core values are the fundamental beliefs or guiding principles that dictate behavior and action, helping individuals and organizations to determine what is important and meaningful.

Chinese Culture

Chinese culture is a rich tapestry of traditions, beliefs, and practices evolved over thousands of years in China, encompassing elements like art, cuisine, festivals, and philosophy.

Mutual Dependence

A relationship between entities where each benefits from and relies on the other, often essential for the welfare of both.