Personal Finance Problem Free cash flow valuation You are evaluating the potential purchase of a small business with no debt or preferred stock that is currently generating $42,500 of free cash flow (FCFo $42,500). On the basis of a review of similar-risk invest- ment opportunities, you must earn an 18% rate of return on the proposed pur- chase. Because you are relatively uncertain about future cash flows, you decide to estimate the firm's value using several possible assumptions about the growth rate of cash flows. a. What is the firm's value if cash flows are expected to grow at an annual rate of P7-16 0% from now to infinity? rate of 7% from now to infinity? 12% for the first 2 years, followed by a constant annual rate of 7% from year 3 c. What is the firm's value if cash flows are expected to grow at an annual rate of to infinity