You have been asked to review the terminal value calculation in a valuation done by another analyst. The analyst has the following estimates for net income and FCFE for the next 3 years: Year 1 Year 2 Year 3 Net Income 150 165 181.5 FCFE 50 55 60.5 To estimate the terminal value, the analyst has taken the FCFE in year 3 and grown it by 3%, (the stable growth rate) and has used a cost of equity of 8%. If the firms return on equity will remain unchanged at current levels in perpetuity and the analysts estimates of FCFE for the high growth period are correct, estimate the correct terminal value of equity, using the perpetual growth rate of 3% and the cost of equity of 8%. (Hint: First find g, b, and ROE in both the high growth and stable growth periods.)