Xanadu Inc. forecasts the free cash flows (in millions) shown below. If the weighted average cost of capital

is 12% and the free cash flows are expected to continue growing at the same rate after Year 3 as from Year 2

to Year 3, what is the Year 0 value of operations, in millions?

Year:123

Free cash flow:-$30$62$65

A.

$386.16

B.

$907.66

C.

$746.22

D.

$532.60