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You're trying to find a company's terminal value of assets based on a perpetuity with...

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Finance

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You're trying to find a company's terminal value of assets based on a perpetuity with growth, discounted by the weighted average cost of capital (WACC). The company's home country is forecast to have 3% real GDP growth and 2% inflation for the foreseeable future. Which of the below statements is NOT correct? The company's terminal value perpetuity growth rate: Select one: O a. In nominal terms must be less than or equal to the country's 5% approximate nominal GDP growth rate, or else the company will eventually take over the country. O b. In real terms must be less than or equal to the country's 3% real GDP growth rate, or else the company will eventually take over the country. O c. Must be zero in nominal terms if the firm's cash flows are forecast to grow by 2% in real terms. O d. Must be less than the firm's WACC, or else the perpetuity formula will give a negative price (though the company will be worth an infinite amount)

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