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A company forecasts free cash flow of $70 million in five years. It expects the free cash flow to grow at a constant rate of

A company forecasts free cash flow of $70 million in five

years. It expects the free cash flow to grow at a constant rate of 7

percent thereafter. If the weighted average cost of capital is 12 percent,

what is the horizon value, to the nearest million? (hint: the horizon

value will not be a present value today, but a value four years from now)

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