13. Free Cash Flow (LO3, CFA7) A firm had a free cash f low (FCF) in the...

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13. Free Cash Flow (LO3, CFA7) A firm had a free cash f low (FCF) in the prior year of

$125 million.

The FCF is expected to grow at 3 percent per year into perpetuity. The appropriate discount rate is 12 percent. What is the firm’s current value (in millions) based on the FCF model?

a. $1,042

b. $1,389

c. $1,555

d. $1,431

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Fundamentals Of Investments Valuation And Management

ISBN: 9781260013979

9th Edition

Authors: Bradford Jordan, Thomas Miller, Steve Dolvin

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Question Posted: Jul 24, 2024 07:03 AM

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13. Free Cash Flow (LO3, CFA7) A firm had a free cash f low (FCF) in the...

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Fundamentals Of Investments Valuation And Management

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