For the year ending December 2018,MTC Corporation is expected to have a free cash flow amounting to P400,000. For the years 2019 and 2020, the companys free cash flow will grow by 5% per annum and after that, the growth rate will be at 4% for the succeeding years. The weighted average cost of capital of the company is 10%.

Additional Information:

• market value of the companys debt = P 3,000,000
• market value of preferred shares = P 800,000

Requirements:

1. What is the companys fair market value?
2. what is the intrinsic value of the companys stock if MTC Corporation has 1,000,000 shares of common stock outstanding?

* Round off final answers to two (2) decimal places, exclude currency sign and include comma as separator.

For the year ending December 2018,MTC Corporation is expected to have a free cash flow amounting to P400,000. For the years 2019 and 2020, the company's free cash flow will grow by 5% per annum and after that, the growth rate will be at 4% for the succeeding years. The weighted average cost of capital of the company is 10%. Additional Information: market value of the company's debt = P 3,000,000 market value of preferred shares = P 800,000 Requirements: 1. What is the company's fair market value? 2. what is the intrinsic value of the company's stock if MTC Corporation has 1,000,000 shares of common stock outstanding? * Round off final answers to two (2) decimal places, exclude currency sign and include comma as separator