Lee is sn analyst for a money management fim. Mary's supervisor asks her to estimate Mry value of the common stock for Asia-Pacifie Corporation (APC), so she collects the the following information of APC. Operating cash flow in 2015 is $522 million. Capital expenditure in 2015 is S150 million. Increase in net working capital in 2015 is $300 million. Tax rate is 34% The growth rate of cash flows ofAPC is estimated to be 8% from2016 to 2018, and 6% forever afterwards. fret The market value of the long-tem debt and common socks re s00 respectively. The cost of debt is 5%. The number of shares outstanding is 300 million million and $900 million, The expected market retum is 12% and the risk-free rate is 4% The variance ofrenns on the market index is 03 and the covariance of retums on APC stock and the market index is 045. Aher collecting the information, Mary starts to estimate the value of the common stock for APC and bere is the summary of her estimation. FCFF(2015)-$522+S150 $300-$372 million FCFF(2016)- $372 (1.08)-$401.76 million FCFF2017)-s372 (1.08)'-$433.90 million FCFF2018)-s372 (1.08)' -$468.61 million FCFF(2019)-s372 (1.08)'1.06)-$496.73 million R.-4% + (0.3/0.45)( 12%-4%-9.33% WAcc-(500/1400)(0.05)( 1-0.34) + (9001400)(0.0933)-7.176% Value of the compeny (in S million) 401.76/107176+433.90/1.07176+468.61/1.07176+496.73(0.07176-0.06y1.07176 $33,145.97 Vilue of a common stock 33,145.97/300 $110.49 Required: () Explain whethe the value of the common stock ofAPC by yourself. r you agree with Mary's estimation method and determine (o) Based on your estimation in (a), explain whether Mary's supervisor should purchase the common stock of APC if the current market price of APC is $20