You are analyzing the U.S. alternative energy industry based upon the P&T ESG Energy Index and using the present value of free cash flow to equity technique. The required rate of return (k) has been estimated at 12%. The FCFE expected in years one, two, and three are $150, $153, and $161. In years four and beyond the growth rate will be a constant 3%. What value does this data imply for the index? Carry at least four decimal places in your calculations. Report your answer in dollars and cents. (Hint: You might want to use the cash flow keys on your financial calculator.) Answer: I

You are analyzing the U.S. alternative energy industry based upon the P\&T ESG Energy Index and using the present value of free cash flow to equity technique. The required rate of return (k) has been estimated at 12\%. The FCFE expected in years one, two, and three are $150,$153, and $161. In years four and beyond the growth rate will be a constant 3%. What value does this data imply for the index? Carry at least four decimal places in your calculations. Report your answer in dollars and cents. (Hint: You might want to use the cash flow keys on your financial calculator.)