Taco Bell has expected sales of $9 billion in one-year, gross profits are 30% of revenues, depreciation of 10% of revenu

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answerhappygod
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Taco Bell has expected sales of $9 billion in one-year, gross profits are 30% of revenues, depreciation of 10% of revenu

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Taco Bell has expected sales of $9 billion in one-year,gross profits are 30% of revenues, depreciation of 10% of revenues,and its tax rate is 20%. Suppose these revenues and costswill continue perpetually.
If the cost of capital is 10%, compute the NPV of an investmentby Bain Capital (a Private Equity Company) that proposes buyingTaco Bell for $25 billion? What is the payback period forthis investment?
Please show all work and formulas
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