Compute the Value of a Firm with Free Cash Flows

question 60

Multiple Choice

Compute the value of a firm with free cash flows of $1000,$2500,and $3000 over the next three years,a terminal firm value of $40,000 after three years,and the unlevered cost of capital is 15%.Assume that the interest rate tax shield is zero.

• A)$26,191
• B)$27,234
• C)$31,033
• D)$39,343
• E)$44,926

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