New Millenium Company earned

$2.7

million in net income last year. It took depreciation deductions of

$295,000

and made new investments in working capital and fixed assets of

$103,000

and

$340,000,

respectively.

a. What was New Millenium's free cash flow last year?

b. Suppose that the company's free cash flow is expected to grow at

6%

per year forever. If investors require a return of

9%

on Millenium stock, what is the present value of Millenium's future free cash flows?c. New Millenium has

3.4

million shares of common stock outstanding. What is the per-share value of the company's common stock?

d. What is the company's P/E ratio based on last year's earnings (i.e., trailing earnings)?

e. What is the company's P/E ratio based on next year's earnings (assuming that earnings grow at the same rate as free cash flow).

a. Millenium's free cash flow last year was

$enter your response here.

(Round to the nearest dollar.)b. The present value of Milleniums future free cash flows is

$enter your response here.

(Round to the nearest dollar.)c. The per-share value of the company's common stock is

$enter your response here.

(Round to the nearest cent.)d. The company's P/E ratio based on last year's earnings (i.e., trailing earnings) is

enter your response here.

(Round to one decimal place.)e. The company's P/E ratio based on next year's earnings is

enter your response here.

(Round to two decimal places.)