1) You are building a free cash flow to the firm model. You expect sales to grow from $1 billion for the year that just ended to $2 billion five years from now. Assume that the company will not become any more or less efficient in the future. Use the following information to calculate the value of the equity on a per-share basis.

1. Assume that the company currently has $300 million of net PP&E.
2. The company currently has $100 million of net working capital.
3. The company has operating margins of 10 percent and has an effective tax rate of 28 percent.
4. The company has a weighted average cost of capital of 9 percent. This is based on a capital structure of two-thirds equity and one-third debt.
5. After year five, growth will be 3 percent in perpetuity.
6. The firm has $300 million of debt.
7. The firm has 100 million shares of equity.
8. Depreciation will be $40 million in year 1 and will grow with revenue in the future.

that is all the given