Question
A research analyst from ABC Investment bank has estimated the following: Free cashflow from year 1-4 (in millions) Year 1 10 2 28 3
A research analyst from ABC Investment bank has estimated the following: Free cashflow from year 1-4 (in millions) Year 1 10 2 28 3 4 32 50 Assume that free cash flow grows at an annual rate of 3% after year 4. If the weighted average cost of capital is 9%, calculate the value of the firm.
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