Use the Information for the Question(s)below

question 68

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 an all-equity firm would be closest to:

• A)$80 million.
• B)$100 million.
• C)$73 million.
• D)$115 million.

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Definitions:

Congenital Adrenal Hyperplasia

A genetic disorder affecting the adrenal glands, leading to a deficiency in certain hormones and an overproduction of others.

Sex Chromosome

A type of chromosome involved in determining the sex of an organism, typically one of two kinds, either X or Y in many species.

CAH

Congenital Adrenal Hyperplasia, a genetic disorder affecting the adrenal glands and influencing the production of certain hormones.

Gender Identity

An individual's personal sense of their own gender, which may or may not correspond to the sex assigned at birth.