Compute the Value of a Firm with Free Cash Flows

question 52

Multiple Choice

Compute the value of a firm with free cash flows of $9 000, $7 000 and $5 000 over the next three years, a terminal firm value of $30 000 after three years, and the unlevered cost of capital is 10%. Assume that the interest rate tax shield is zero.

• A)$38 745
• B)$40 263
• C)$37 098
• D)$36 109