What is the horizon value

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Reference no: EM131185417

Capsim Corporation is undergoing a restructuring, and its free cash flows are expected to be unstable during the next few years. However, FCF is expected to be $50 million in Year 5, i.e., FCF at t = 5 equals $50 million, and the FCF growth rate is expected to be constant at 6% beyond that point. If the weighted average cost of capital is 14%, what is the horizon value (in millions) at t = 5?

Reference no: EM131185417

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