It is 2020. You are investigating the possibility of making an equity investment in Walkerville Woodworking Inc., a firm that specializes in producing antique-style furniture with a modern twist. Your research has revealed the following information:

Walkerville has $8 million in excess cash and $4.5 million in debt.

The company is expected to have free cash flow of $27 million in 2021 and $34 million in 2022.

Beyond 2022, free cash flow is expected to grow at a constant rate of 2% per year forever.

Walkervilles weighted average cost of capital (WACC) is 11% and it has 9 million shares outstanding.

Question A: (5 points)

What is the current enterprise value of Walkerville Woodworking given the above assumptions?

A.$330.94 million

B.$364.66 million

C.$402.10 million

D.$338.98 million

E. $368.16million

Question B: (5 points) What should be the price of one share of Walkerville stock?

A. $40.13

B. $40.91

C. $45.07

D. $37.66

E. $36.38