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Hello John,
– NCW Co is considering acquiring the ordinary share capital of CEW Co. CEW has for years generated an annual cash inflow of $10 million. For a one off investment of $6m in new machinery, earnings can be increased by $2m per annum. NCW has a cost of capital of 10%.
What is the value of NCW Co?
1. The answer is $ 114m
2. Could you please help how to obtain the anwer?
Thanks
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