ABC, Inc. is expected to have the following free cash flows (FCF):

Year	1	2	3	4	..
FCF (million)	13	15	16	17	Grow by 3% per year

a. If ABCs beta is 0.8, the market return is 14% and the risk free rate is 4%, what should be ABCs expected return.

b. If ABC has 66 million shares outstanding, 33 million in excess cash, and it has 5 million in debt, what should be its stock price today (i.e., P₀)? (Note: use the r calculated in a).

c. ABC has no plans to add more debt, change the number of shares outstanding, or change its cash holdings (it does not invest its cash holdings). If you plan to sell ABC in three years (i.e., just after FCF₃ is realized), what is its expected price in three years (i.e., P₃)?

d. ABC has no plans to add more debt, change the number of shares outstanding, or change its cash holdings (it does not invest its cash holdings). If you plan to sell ABC in three years (i.e., just after FCF₃ is realized), how much are you willing to pay for a share of this company TODAY (i.e., P0)?