Assess the value of the firm shares


Calculating Present Values

Response to the following problem:

In 2008, British Airways had a pension liability of £330 million. Let's assume it must be paid in 30 years' time. To assess the value of the firm's shares, financial analysts want to discount this liability back to the present. If the relevant discount rate is 5.6 per cent, what is the present value of this liability?

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Financial Accounting: Assess the value of the firm shares
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