1. Given are the following data for year 1:

Profits after taxes = $14 million; Depreciation = $6 million; Interest expense = $6 million; Investment in fixed assets = $12 million; Investment in working capital = $3 million. The corporate tax rate is 25 percent. Assume that free cash flow grows at a rate of 5 percent for year 2 and 3, and then it grows at a rate of 3 from year 4 and beyond. The weighted average cost of capital is 10 percent. If the company has $20 million debt and 1 million shares outstanding.

i. Calculate the free cash flow (FCF) for year 1, 2, 3, and 4.

ii. Calculate the value of the firm.

iii. Calculate value per share.