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Vezuvo Technologies has $75 million in excess cash and no debt. The firm expects to generate additional free cash flows of $50 million per year in subsequent years and will pay out these future free cash flows as regular dividends. Vezuvo's unlevered cost of capital is 10% and there are 10 million shares outstanding. Vezuvo's board is meeting to decide whether to pay out its $75 million in excess cash as a special dividend or to use it to repurchase the firm's shares.
-Assume that Vezuvo uses the entire $75 million in excess cash to pay a special dividend. The amount of the regular annual dividends in the future is closest to:
Sieve-Tube Members
Specialized elongated cells in the phloem of vascular plants, which transport sugars and other organic nutrients.
Vascular Cambium
A layer of actively dividing cells in plants that produces secondary xylem (wood) and phloem, contributing to the thickness of stems and roots.
Mycorrhizae
Symbiotic associations between fungi and plant roots, enhancing nutrient and water absorption for the plant while the fungus benefits from access to carbohydrates.
Roots
The part of a plant that typically lies below the surface of the soil, responsible for anchoring the plant and absorbing water and nutrients.
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