4. Last year, A advised a client on the purchase of a small industrial company...
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4. Last year, A advised a client on the purchase of a small industrial company that generates $1mn in revenue, which grows 5% in perpetuity. The company has a 7% discount rate, a 12.5% EBIT margin, a 20% tax rate, depreciation expense of $50K, capex of $40K, and a $10K increase in net working capital. How should he have valued the company? Please show work.
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