More on the corporate valuation model

1. Ankh-Sto Associates Co. is expected to generate a free cash flow (FCF) of $13,585.00 million this year (FCF = $13,585.00 million), and the FCF is expected to grow at a rate of 26.20% over the following two years (FCF and FCF). After the third year, however, the FCF is expected to grow at a constant rate of 4.26% per year, which will last forever (FCF). Assume the firm has no nonoperating assets. If Ankh-Sto Associates Co.s weighted average cost of capital (WACC) is 12.78%, what is the current total firm value of Ankh-Sto Associates Co.? (Note: Round all intermediate calculations to two decimal places.)

$270,212.34 million

$40,607.29 million

$225,176.95 million

$305,369.85 million

2. Ankh-Sto Associates Co.s debt has a market value of $168,883 million, and Ankh-Sto Associates Co. has no preferred stock. If Ankh-Sto Associates Co. has 225 million shares of common stock outstanding, what is Ankh-Sto Associates Co.s estimated intrinsic value per share of common stock? (Note: Round all intermediate calculations to two decimal places.)

$249.20

$750.59

$275.21

$250.20