Hoth Therapeutics has no debt and has 20million shares outstanding. Hoth also has $300 million in cash and expects future free cash flows of $80 million per year. It has the options of paying out a dividend, repurchase its shares or invest in future growth. Hoth decides it will invest the cash in an additional production facility to expand future operations. Under this scenario, expanding its operations will increase future free cash flows by 12%. Assume Hoths cost of capital is 10% and assumes that capital markets are perfect

What is the value of Hoth if they use the $300 million to expand?

A) $688 million. B) $960 million. C) $950 million. D) $825 million