RTE Telecom Inc. is expected to generate a free cash flow of $167 million this year (FCF1 = $167 million), and the FCF is expected to grow at a rate of 26.20% over the following two years (FCF2 and FCF3). After the third year, however, the FCF is expected to grow at a constant rate of 4.26% per year, which will last forever. RTE Telecom Inc.'s weighted average cost of capital (WACC) is 12.78%.

Use corporate valuation method to complete your analysis:

1. You would discount the FCFs using the ____________ in your valuation.

Options: WACC / Short-run growth rate / Long-run growth rate

2. The horizon value of RTE Telecom Inc.'s cash flow is _________.

Options: $210.75 million / $3,254.69 / $277.30 million

3. The current total firm value of RTE Telecom Inc. operations is __________.

Options: $3,753.87 million / $3.321.68 million / $2,768.07 million / $499.18 million

If RTE Telecom Inc. carries $2,076 million of debt before the merger, and the firm has no nonoperating assets or preferred stock, the value of equity of RTE Telecom Inc. to Ziffy Corp. will be:

a. $392.07 million

b. $692.07 million

c. $2,076.07 million

d. $1,677.87 million

If possible, please show how to complete these types of problems in Excel. Thank you!