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What is the horizon value of the unlevered operations

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Reference no: EM132384751

Richter Manufacturing has a 10% unlevered cost of equity. Richter forecasts the following free cash flows (FCFs), which are expected to grow at a constant 3% rate after Year 3.

Year 1 Year 2 Year 3

FCF 715 750 805

a. What is the horizon value of the unlevered operations?

b. What is the total value of unlevered operations at Year 0?

Reference no: EM132384751

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