John Adams Enterprises has never paid a dividend. Free cash flows are projected to be $800,000 and $950,000 for the next 2 years, respectively, and it is expected to grow at a constant rate of 4 percent after the second year. The companys weighted average cost of capital is 9%. Non-operating assets are valued at $3,000,000. The market value of the debt is $4,000,000 and the market value of the preferred stock is $1,000,000.

1. Calculate the value of the firms operations.
2. What is the market value of the firm?
3. What is the market value of the firms equity?