Use the Information for the Question(s)below

question 22

Multiple Choice

Use the information for the question(s) below.
You expect CCM Corporation to generate the following free cash flows over the next five years: Following year five,you estimate that CCM's free cash flows will grow at 5% per year and that CCM's weighted average cost of capital is 13%.
-The enterprise value of CCM corporation is closest to:

• A)$396 million.
• B)$290 million.
• C)$382 million.
• D)$350 million.

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Definitions:

Private Restrictions

Limitations imposed by private parties rather than governmental entities on the use of property, often found in deeds or homeowners' association rules.

Land

The solid part of the earth's surface including the ground and all natural resources and features.

Zoning Restrictions

Zoning restrictions regulate the use and development of real estate in specified areas, often determining the type of buildings that can be constructed.

Variance

A permission granted by a government or regulatory body to deviate from the strict enforcement of zoning laws or regulations.