Bay Properties is considering starting a commercial real estate division. It has prepared the following four-year forecast of free cash flows for this division: Assume cash flows after year 4 will grow at 3% per year, forever. If the cost of capital for this division is 14%, what is the continuation value in year 4 for cash flows after year 4? What is the value today of this division? may you show in Excel

Year 1 Year 2 $12,000 Year 3 $99,000 Year 4 $240,000 Free Cash Flow -$185,000 Year 1 Year 2 $12,000 Year 3 $99,000 Year 4 $240,000 Free Cash Flow -$185,000