Question 3 [2 points] Gilmore Limited has the following projected equity cash flows (FCFE) and enterprise free cash flows (FCFF) over the next five years: FCFE 120 $ millions Year 1 2 3 4 5 125 Interest (1 -t) 30 32 33 35 37 FCFF 150 157 165 175 187 132 140 150 4,200 Terminal Value 2,500 Note: terminal value is the value at the end of year 5. Gilmore Limited has a cost of equity of 12% and a WACC of 8%. a. What is the value of the equity? [1 point] b. What is the value of the operations? [1 point]