You must answer ALL THREE questions, using a separate document for each. QUESTION 1 Suppose that the free cash flows available for a firm is 10 million at the moment. Furthermore, they are expected to grow at a rate of 10% over the next three years. Starting from year 4, the growth rate is expected to go down to 5% and remain at that level indefinitely. The firm's cost of equity and cost of debt are 8% and 6%, respectively. Furthermore, the firm's equity value is 360 million and there are 10 million shares outstanding. The market value of the firm's debt is 90 million. The corporate tax rate is 40% 1.1. Using the data provided above, comment on the intrinsic value of this firm. The maximum word count is 250 words (15%) 1.2. You have been told that the cost of equity for the company above is estimated using the capital asset pricing model. Offer a critical discussion of this model. The maximum word count is 750 words (18%) TOTAL (33%) You must answer ALL THREE questions, using a separate document for each. QUESTION 1 Suppose that the free cash flows available for a firm is 10 million at the moment. Furthermore, they are expected to grow at a rate of 10% over the next three years. Starting from year 4, the growth rate is expected to go down to 5% and remain at that level indefinitely. The firm's cost of equity and cost of debt are 8% and 6%, respectively. Furthermore, the firm's equity value is 360 million and there are 10 million shares outstanding. The market value of the firm's debt is 90 million. The corporate tax rate is 40% 1.1. Using the data provided above, comment on the intrinsic value of this firm. The maximum word count is 250 words (15%) 1.2. You have been told that the cost of equity for the company above is estimated using the capital asset pricing model. Offer a critical discussion of this model. The maximum word count is 750 words (18%) TOTAL (33%)