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Urgent Suppose you are planning of investing in a company Alpha. This company is expected to generate free cash flows of $1.76 mil per year,
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Suppose you are planning of investing in a company Alpha. This company is expected to generate free cash flows of $1.76 mil per year, growing at a rate of 2.65% per year. From your financial manager, you know that the market portfolio's return is 11.23% and the risk-free rate of return is 3.69%, the equity and debt betas of Company F are 1.66 and 0.53, respectively.
What is the value of this company if the debt to equity ratio equals 3.42?
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