more. 11. More on the corporate valuation model Aa Aa Widget Corp. is expected to generate a free cash flow (FCF) of $8,725.00 million this year (FCF1 = $8,725.00 million), and the FCF is expected to grow at a rate of 21.40% over the following two years (FCF2 and FCF3). After the third year, however, the FCF is expected to grow at a constant rate of 2.82% per year, which will last forever (FCFA). If Widget Corp.'s weighted average cost of capital (WACC) is 8.46%, what is the current total firm value of Widget Corp.? $253,034.82 million $261,550.68 million O $27,127.10 million O $210,862.35 million Widget Corp.'s debt has a market value of $158,147 million, and Widget Corp. has no preferred stock. If Widget Corp. has 450 million shares of common stock outstanding, what is Widget Corp.'s estimated intrinsic value per share of common stock? O $351.44 $128.86 O $116.15 O $117.15 12. Valuing preferred stock Companies that have preferred stock outstanding promise to pay a stated dividend for an infinite period. Preferred stock is treated like a perpetuity if the payments last forever. Preferred stocks are considered to be a hybrid of a stock and a bond. For example, one of the major differences between preferred shares and bonds is that the issuing companies can suspend the payment of their preferred dividends without throwing the company into bankruptcy. However, similar to bonds, preferred stockholders receive a fixed payment-their dividend-before the company's residual earnings are paid out to its common stockholders and, as with common stock, preferred stockholders can benefit from an appreciation in the value of the firm's stock securities, Consider the following case of International Imports (12): International Imports (12) pays an annual dividend rate of 9.40% on its preferred stock that currently returns 12.60% and has a par value of $100.00 per share. What is the value of 12's preferred stock? O $89.52 per share O $100.00 per share O $74.60 per share O $111.91 per share Suppose that there is high unemployment, which causes interest rates to fall, which in turn pulls the preferred stock's yield to 7.56%. The value of the preferred stock will