2)

Year1234

Free Cash

Flow$12

million$18 million$22 million$26 million

Conundrum Mining is expected to generate the above free cash flows over the next four years, after which they are expected to grow at a rate of 4% per year. If the weighted average cost of capital is 12% and Conundrum has cash of $85 million, debt of $70 million, and 30 million shares outstanding, what is Conundrum's expected current share price?

A.$ 12.44

B.$ 15.79

C.$ 15.31

D.$ 9.57

3)

Use the table for the question(s) below.

Name	Market Capitalization ($ million)	Enterprise Value ($ million)	P/E	Price/ Book	Enterprise Value/ Sales	Enterprise Value/ EBITDA
Gannet	6350	10,163	7.36	0.73	1.4	5.04
New York Times	2423	3472	18.09	2.64	1.10	7.21
McClatchy	675	3061	9.76	1.68	1.40	5.64
Media General	326	1192	14.89	0.39	1.31	7.65
Lee Enterprises	267	1724	6.55	0.82	1.57	6.65
Average			11.33	1.25	1.35	6.44
Maximum			+60%	112%	+16%	+22%
Minimum			-40%	-69%	-18%	-19%

The table above shows the stock prices and multiples for a number of firms in the newspaper publishing industry. Another newspaper publishing firm (not shown) had sales of $600million, EBITDA of $84 million, excess cash of$61million, $17million of debt, and 120 million shares outstanding. If the average enterprise value to sales for comparable businesses is used, which of the following is the best estimate of the firm's share price?

A.$7.47

B.$ 7.12

C.$ 6.41

D.$ 7.00