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Next Period's Expected Free Cash

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3. (TCO E);Division;Asset;Beta;Next Period's Expected Free Cash;Flow ($mm);Expected;Growth;Rate;Oil Exploration;1.4;450;4.0%;Oil Refining;1.1;525;2.5%;Gas and Convenience Stores;0.8;600;3.0%;The risk-free rate of interest is 3% and the market risk premium is 5%.;1) Which is the cost of capital for the oil exploration division closest to?;A) 6.0%;B) 7.0%;C) 8.5%;D) 10.0%

 

Paper#28719 | Written in 18-Jul-2015

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