Loma Vista Inc. is a small, publicly traded company that manufactures beachwear and casual apparel. The company generated $ 10 million in after-tax operating income on revenues of $100 million in the most recent year. It reported book value (and market value) of debt of $15 million, book value of equity of $45 million and a cash balance of $10 million; the company's return on capital is expected to remain stable in perpetuity. The company has a cost of equity of 15% and a cost of capital of 12% today. a) Loma Vista had capital expenditures of $7 million and depreciation of $ 5 million in the most recent year. Its working capital increased from $9 million to $10 million during the year. Finally, while the company did not do an acquisition last year, it does one acquisition every 5 years at a cost of approximately $15 million. Assuming that it continues its existing reinvestment policy, estimate the expected free cash flow to the firm each year for the next 3 years. (5 points) b) At the end of year 3, the company expects growth to drop to 3% a year in perpetuity and its cost of equity will drop to 12% and its cost of capital to 10% after year 3. Estimate the terminal value (end of year 3). (5 points) c) Estimate the value of equity per share today if there are 5 million shares outstanding. (Please be explicit about the discount rate that you are using to compute your value today.) (5 points)