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Questions for Mercury Athletic Footwear 1. Is Mercury an appropriate target for AGI? Why or why not? 2. Review the assumptions for projecting the cash flows of the project? Are they appropriate? Would you make any changes? 3. Estimate the FCF of Mercury for the first 10 years. 4. Assuming a cost of capital of 13.45% estimate the enterprise value of Mercury. 5. Do you regard the value you obtained as conservative or aggressive? Why? 6. What sensitivity analysis would you do to the base case value? Please help me answer the sixth question

Questions for Mercury Athletic Footwear 1. Is Mercury an appropriate target for AGI? Why or why not? 2. Review the assumptions for projecting the cash flows of the project? Are they appropriate? Would you make any changes? 3. Estimate the FCF of Mercury for the first 10 years. 4. Assuming a cost of capital of 13.45% estimate the enterprise value of Mercury. 5. Do you regard the value you obtained as conservative or aggressive? Why? 6. What sensitivity analysis would you do to the base case value? Please help me answer the sixth question

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Questions for Mercury Athletic Footwear 1. Is Mercury an appropriate target for AGI? Why or why not? 2. Review the assumptions for projecting the cash flows of the project? Are they appropriate? Would you make any changes? 3. Estimate the FCF of Mercury for the first 10 years. 4. Assuming a cost of capital of 13.45% estimate the enterprise value of Mercury. 5. Do you regard the value you obtained as conservative or aggressive? Why? 6. What sensitivity analysis would you do to the base case value? Please help me answer the sixth question
Transcribed Image Text:Questions for Mercury Athletic Footwear 1. Is Mercury an appropriate target for AGI? Why or why not? 2. Review the assumptions for projecting the cash flows of the project? Are they appropriate? Would you make any changes? 3. Estimate the FCF of Mercury for the first 10 years. 4. Assuming a cost of capital of 13.45% estimate the enterprise value of Mercury. 5. Do you regard the value you obtained as conservative or aggressive? Why? 6. What sensitivity analysis would you do to the base case value? Please help me answer the sixth question
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