Given the following inputs,compute the continuing value (CV )at time t in the economic-profit model.At time t invested capital equals $2,000 and ROIC equals 12 percent.The forecast for NOPLATt?? is $240.The growth rate equals 2 percent,RONIC is 10 percent,and the WACC is 7 percent.The continuing value at time t is closest to:
A)$1,840.0
B)$1,428.6
C)$822.8
D)$411.4

Question

Quizplus · Accepted Answer

The continuing value (CV) is calculated using the formula: CV = NOPLATt * (1 + g) / (WACC - g). Substituting the given values: CV = $240 * (1 + 0.02) / (0.07 - 0.02) = $1,840.

Given the Following Inputs,compute the Continuing Value (CV )At Time