Compute the Value of a Firm with Free Cash Flows

question 36

Multiple Choice

Compute the value of a firm with free cash flows of $4000,$4500,and $5000 over the next three years,a terminal firm value of $60,000 after three years,and the unlevered cost of capital is 10%.Assume that the interest rate tax shield is zero.

• A)$56,191
• B)$57,234
• C)$58,098
• D)$59,123
• E)$61,431

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Definitions:

Stored Information

Data or knowledge retained in the mind or in digital/formal systems for future use.

Consciousness

A concept with many meanings, including sensory awareness of the world outside, direct inner awareness of one’s thoughts and feelings, personal unity, and the waking state.

Long-Term Memory

Long-term memory is the component of the memory system capable of storing large amounts of information for periods ranging from days to a lifetime.

Hierarchy

A system in which members of an organization or society are ranked according to relative status or authority.