why the concept of perpetuity not been applied in the answer for example when calculate company value through FCF they should divide 1/1.11 three times
Also the synergy 150000 is forever shoudt divide 0.11
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2012 june q1
9y ago#1In future please give the name of the question when it is an old question - not just the date of the exam. That way I can find it more quickly.
I assume you are referring to the question Nente.
They have applied the perpetuity rules, but since it is an inflating perpetuity they have used the dividend valuation formula (which can be used to get the PV of any inflating perpetuity).
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