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A company earned $20 million before interest and taxes on revenues of $60 million last year. Investment in fixed capital was $12 million, and depreciation

  1. A company earned $20 million before interest and taxes on revenues of $60 million last year. Investment in fixed capital was $12 million, and depreciation was $8 million. Working capital investment was $3 million. The company expects EBIT, investment in fixed and working capital, depreciation, and sales to grow at 12% per year for the next five year. After five years, the growth in sales, EBIT, and working capital investment will decline to a stable 4% per year, and investments in fixed capital and depreciation will offset each other. Tax rate is 40%. Assume the WACC is 11% during the high growth stage and 8% during the stable stage What is the FCFF in Year 6? What is the terminal value in Year 5? And What is the value of the firm?

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