1. a) Zhdanov, Inc. forecasts that its free cash flow in the coming year, i.e., at t = 1, will be -$15 million (negative), but its FCF at t = 2 will be $30 million. After Year 2, FCF is expected to grow at a constant rate of 3% forever. If the weighted average cost of capital is 16%, what is the firm's value of operations, in millions?

1. b) Zhdanov, Inc. forecasts the free cash flows (in millions) shown below. If the weighted average cost of capital is 15% and the free cash flows are expected to continue growing at the same rate after Year 3 as from Year 2 to Year 3, what is the Year 0 value of operations, in millions?

Year	Free Cash Flow
1	$ (22.00)
2	$ 42.00
3	$ 45.00