Question
1. Super Charged Corp.s free cash flows are forecast to be $184 million in one year, $257 million in two years, and $386 million in
1. Super Charged Corp.s free cash flows are forecast to be $184 million in one year, $257 million in two years, and $386 million in three years. Its free cash flows are expected to increase by 5% every year after three years. Super Charged Corp.s weighted average cost of capital is 12%. What is the enterprise value of Super Charged Corp.? Round your answer to the nearest one-hundredth of a million dollars. Do not include the percent sign.
2. Next year, Zenith Corp. is expected to generate $799 million in sales (revenues), spend $339 million in operating costs, spend $86 million on long-term assets, and increase net working capital by $37 million. It is expected to book $50 million in depreciation. The corporate tax rate is 29%. What will is the forecast for next years free cash flow? Round you answer to the nearest one-hundredth of a million dollars. Do not include the dollar sign ($).
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