Conundrum Mining Is Expected to Generate the Above Free Cash

question 25

Multiple Choice

Conundrum Mining is expected to generate the above free cash flows over the next four years, after which they are expected to grow at a rate of 6% per year. If the weighted average cost of capital is 12% and Conundrum has cash of $80 million, debt of $60 million, and 30 million shares outstanding, what is Conundrum's expected terminal enterprise value?

• A)$413.4 million
• B)$459.3 million
• C)$505.3 million
• D)$528.2 million

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Definitions:

Random Assignment

A method used in experiments to allocate participants to different groups using randomization, ensuring each participant has an equal chance of being placed in any group.

Random Sampling

A method of selecting a sample from a population where each member has an equal chance of being chosen.

Gender Similarities

The perspective that emphasizes the similarities rather than differences between genders in various psychological traits and behaviors.

Psychological Differences

Variations in mental processes or behaviors among individuals due to various factors such as genetics, environment, or experiences.