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Assuming ABC Ltds free cash flow is R45 000 in year one and grows at a constant rate of 5% p.a. for years 2 through
Assuming ABC Ltds free cash flow is R45 000 in year one and grows at a constant rate of 5% p.a. for years 2 through to year 5. After year 5 the free cash flows grow at 3% into perpetuity. Calculate the present value of the terminal value free cash flow (excluding the present value of cash flows for years 1 to 5). The cost of capital for ABC Ltd is 12%. Assume cash flows are earned at the end of the period. Use full years in your discounting calculations. Group of answer choices R355,201 R424,308 R317,143 R362,373
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