The Lenox Feed, a chain of Pet Supply Stores had a free cash flow for FY 2021 of $5,250 (all amounts are in $000). Chester Smart , CEO, has developed a four year free cash projection, along with estimated cost of capital during the 4 year period, and terminal growth and cost of capital projections. — a copy of which has been reproduced in the table below.  FY2022-FY2023 FY2024-FY2025 From the end of FY2025  to perpetuity Growth Rate 3.2% 2.5% 1.5% Cost of Capital 4.25% 5.20% 5.00% Considering this forecast he asked his CFO (you) to determine the company’s valuation using the NPV (net present value) method. Choose the best answer from the list of options below. For this question consider FY2022 as Year 1 and FY2025 as Year 4.  (NOTE THAT EXCEL WAS USED TO CALCULATE THE ANSWER TO THIS PROBLEM) Problem Counts 6 Points

Accounting Formulas: Gain/Loss on Equipment (Sale) = Market Value – Book Value (a positive is a gain, a negative is a loss). A gain is a positive cash flow. Note that the book value of piece of equipment is equal to its original capitalized cost less its accumulated depreciation. Finance Formulas: WACC = (Cost of Debt * (1 -t)) * (Total Debt/(Total Debt + Total Equity)) PLUS  (Cost of Equity* (Total Equity/(Total Debt + Total Equity))) Cost of Debt = Risk Free Rate + Default Risk Premium  Cost of Equity = Risk Free Rate + (Beta * Market Risk Premium) Market Value Added (MVA): Formula not provided. You need to know this one. Stock Valuation Models:             Zero Growth Rate for Dividends into Perpetuity: Price = Div0/r            Constant Growth Rate for Dividends into Perpetuity: Price = Div1/(r-g).   OR. Price = (Div0 * (1+g))/(r-g) Growth Opportunities             P = (EPS/R) + NPVGO Cash Flow Models:             Annual Firm Level Free Cash Flow: FCF = (EBIT * (1-t)) – Capex – Change in WC + Depreciation                OR FCF = (EBITDA – Depreciation expense) * (1-t) + Depreciation – Capex – Change in WC                                                      Firm Terminal Value at year N: = (EBIT (n) * (1+g) * (1-t))/(r-g)                         (note similarity to constant growth dividend model) Net Present Value/Future Value/IRR/Payment Annuities: Use Excel macros Payback Period/ Discount Payback Period: No formulas — use methods shown in class. Profitability Index: PI = PV of Benefit Stream (Free Cash Flows)/Initial Investment NET Debt = Total Debt – Cash (and Cash Equivalents)  

Which one of these applies to the dividend growth model of stock valuation?

Find the partial derivative

Which of the following represents an equation for a tangent plane to the surface

Find , the vector projection of b onto a, if

Find the exact angle between the vectors

Find the unit tangent vector, , and the unit normal vector, , to the curve given by

There are 3 Free Response questions worth 10 points each.   Fully work out solutions to all three problems before submitting your exam. To receive full credit you must 1. Show all work on your separate paper 2. Show the completed answer to the Webcam to be recorded by Honorlock 3. Upload a .pdf scan of the completed work shown to the “Exam 1 Free Response Submission” assignment. Note: You do not need to type anything in the essay box. You may type something like “done” if you wish to signify to yourself that you have finished the problem.

A type family is a form of categorizing typefaces. Every family has a script, slab serif, serif, and sans-serif.