Factrack Inc

question 3

Multiple Choice

Factrack Inc., a biotech firm, is expected to grow rapidly in the next three years and then have a level growth rate for the foreseeable future. The firm expects free cash flows of $342.5 million, $512.3 million, and $750 million over the next three years, and thereafter its cash flows will grow at a steady rate of 8 percent per year. The company has no nonoperating assets (NOA) . If the appropriate WACC is 11.25 percent, what is the enterprise value of this business? (Round to the nearest million.)

• A) $19,367 million
• B) $18,101 million
• C) $26,190 million
• D) $24,923 million

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Definitions:

Vocational Skills

Practical abilities and know-how related to specific trades or professions, acquired through training and experience.

Autism Spectrum Disorder

A range of neurodevelopmental disorders characterized by social deficits, communication difficulties, and restricted, repetitive, and stereotyped patterns of behavior.

Atypical Antipsychotic Medications

A newer class of psychiatric drugs that typically have fewer side effects than older antipsychotic medications and are used to treat symptoms of psychiatric disorders.

Autism Spectrum Disorder

Autism Spectrum Disorder is a developmental disorder characterized by challenges with social interaction, communication, and by restricted, repetitive patterns of behavior, interests, or activities.