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In an effort to Compensate for shrinking land-line customers, SBC and Bell South(owners of Cingular Wireless LLC) got into a bidding war with Vodaphone to acquire AT&T Wireless. The inital $11 per share offer escalted to $13 for the 2.73 billion shares of AT&T Wireless. If the buyout took exactly 1 year to close(i.e end of year 1), what would be the prsent worth today(time 0) of the aquisition for profits of $5.3 billion in year 2, inceasing by 9% per year through year 11? Assume SBC and Bell South use a rate of return of 15% per year.

Econometrics, Economics

  • Category:- Econometrics
  • Reference No.:- M9693142

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