11. Risk-return trade-offs (TPG 9.10): In the open market, the assumption of increased risk would also be compensated by an increase in the expected return, although the actual return may or may not increase depending on the degree to which the risks are actually realised.
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14. Case study FFD Business Model Operational profit Revenu Sales ASP ($47,50-$52,50) Sales volume (850k—950k) Cost of sales ACP ($37,50) Sales volume (850k-950k) Opex Fixed Opex ($5.5m) Variable Opex Cost ratio (10%) Sales ASP ($47,50-$52,50) Sales volume (850k-950k)
20. Case study (continued) Use of WACC to evaluate after conversion TP Value Consolidated Value LRD Value Principal Forecast LRD profit LRD WACC Forecast Principal profit Principal WACC