Just Falafs, the Mediterranean grocery store chain, will generate $803.6 million of free cash flow at the end of the year. Analysts expect the company to last forever and do not expect the free cash flow to ever change. Just Falafs has debt worth $2.4 billion with an annual coupon (and yield) of 4.5%. Stockholders require a return of 13%. The company has a debt-to-value ratio of 30% and management plans to maintain that ratio. The corporate tax rate is 30%. Use this information to answer the questions that follow.

Part 1

What is free cash flow to equity? Express your answer in millions of dollars rounded to one decimal place.

Free cash flow to equity = $M

Question 2

Part 2

What is the value of the equity using the FCFE approach? Express your answer in millions of dollars rounded to one decimal place.

Value of equity = $M

Question 3

Part 3

What is the value of the equity using the DCF/WACC approach? Express your answer in millions of dollars rounded to one decimal place.

Value of equity = $M