You have the following information relating to a levered company with annual perpetual cash flows from assets that grow. The next cash flow will be generated in one year from now.

Use this information to value the companys equity.

Data on a Levered Firm with Perpetual Cash Flows

Item abbreviation	Value	Item full name
FFCF (millions)	$7.6	Firm free cash flow (or Cash Flow from Assets)
g	3% pa	Growth rate of FFCF
rD	4% pa	Cost of debt
rEL	6.5% pa	Cost of levered equity
D/VL	35% pa	Debt to assets ratio, where the asset value includes tax shields
tC	30%	Corporate tax rate

The current value of levered equity is

a.

$188.19

b.

$289.52

c.

$447.63

d.

$120.63

e.

$344.67