TTC has been growing at a rate of 20% per year in recent years. This same growth rate is expected to last for another 2 years, then decline to g n = 6 % . a. TTC recently introduced a new line of products that has been wildly successful. On the basis of this success and anticipated future success, the following free cash flows were projected:

After the 10th year, TTCs financial planners anticipate that its free cash flow will grow at a constant rate of 6%. Also, the firm concluded that the new product caused the WACC to fall to 9%. The market value of TTCs debt is $1,200 million, it uses no preferred stock, it has zero nonoperating assets; and there are 20 million shares of common stock outstanding. Use the corporate valuation model to value the stock.