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A firm reported after-tax operating income of $50 million in the most recent year on capital invested of $400 million. The firm expects operating income
A firm reported after-tax operating income of $50 million in the most recent year on capital invested of $400 million. The firm expects operating income to grow 5% a year for the next three years, and 3% thereafter. If the firm's cost of capital is 10% and you expect the firm's current return on capital to continue in perpetuity. Estimate the value (in millions) at the end of the third year.
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