Use the Information for the Question(s)below

question 91

Multiple Choice

Use the information for the question(s) below.
Flagstaff Enterprises expected to have free cash flow in the coming year of $8 million,and this free cash flow is expected to grow at a rate of 3% per year thereafter.Flagstaff has an equity cost of capital of 13%,a debt cost of capital of 7%,and it has a 35% corporate tax rate.
-If Flagstaff currently maintains a .5 debt to equity ratio,then the value of Flagstaff as a levered firm is closest to:

• A)$114 million.
• B)$100 million.
• C)$107 million.
• D)$140 million.

---

Definitions:

Corn Syrup

A sweet syrup derived from the starch of corn, used as a sweetener and thickener in foods and beverages.

Nutritional Plan

A detailed guide for eating that outlines what and when a person should eat to achieve specific health or dietary goals.

Expected Outcomes

The anticipated results or effects of an intervention, treatment, or action.

Nutritional Needs

The essential vitamins, minerals, and other nutrients required by the body to maintain health and proper functioning.