Problem 6 Intro It is December 2019. Google has offered to buy your internet startup. The Google negotiators and you both agree on the following expectations. Year 2020 2021 2022 2023 2024 Expected free cash flow (end of year) 120,000 180,000 270,000 360,000 450,000 After 2024, cash flows are expected to grow by 2% per year. Based on the riskiness of your industry, you think that your weighted average cost of capital is 18%. You have bank loans worth $400,000 outstanding. - Attempt 1/5 for 10 pts. Part 1 What is the terminal value, i.e., the present value of all free cash flows from 2025 to infinity expressed in 2024-dollars? 2868750 Correct Since we are only given the free cash flows for the next five years, we need to find the terminalvalue, i.e., the present value of all free cash flows from years 2024 to infinity: Since we are only given the free cash flows for the next five years, we need to find the terminalvalue, i.e., the present value of all free cash flows from years 2024 to infinity: FCF2,025 FCF2,026 5 +... V2,024 = 1+rwACC (1+rwacc)' We can use the formula from the constant dividend growth model to find the (2024) present value: FCF2,024(1 +g) V2,024 = PWACC 9 450,000 (1 + 0.02) 0.18 0.02 = 2,868,750 Part 2 1 Attempt 5/5 for 10 pts. What is the total value of the company? No decimals Submit Part 3 1 Attempt 1/5 for 10 pts. What is the value per share of common stock if you have 100,000 shares outstanding? 1+ decimals Submit