Kale Inc. forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. If the weighted average cost of capital is 11.0% and FCF is expected to grow at a rate of 5.0% after Year 2, then what is the firm's total corporate value (in millions)? Do not round intermediate calculations. Year Free Cash flow a. $2,100 million b. $1,862 million c. $1,775 million d. $1,616 million e. $1,677 million 1 -$30 2 $120

Essentials Of Investments
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MC.09.073.Algo
Kale Inc. forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. If the weighted average cost of
capital is 11.0% and FCF is expected to grow at a rate of 5.0% after Year 2, then what is the firm's total corporate value (in millions)? Do not round
intermediate calculations.
Year
Free Cash flow
a. $2,100 million
b. $1,862 million
c. $1,775 million
d. $1,616 million
e. $1,677 million
1
-$30
* Question 21 of 40
2
$120
Transcribed Image Text:MC.09.073.Algo Kale Inc. forecasts the free cash flows (in millions) shown below. Assume the firm has zero non-operating assets. If the weighted average cost of capital is 11.0% and FCF is expected to grow at a rate of 5.0% after Year 2, then what is the firm's total corporate value (in millions)? Do not round intermediate calculations. Year Free Cash flow a. $2,100 million b. $1,862 million c. $1,775 million d. $1,616 million e. $1,677 million 1 -$30 * Question 21 of 40 2 $120
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