What is the year 0 value of operations in millions

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A company forecasts the free cash flows (in millions) shown below. The weighted average cost of capital is 13% and the FCF's are expected to continue growing at a 5% rate after year 3. Assuming that the ROIC is expected to remain constant in year 3 and beyond, what is the year 0 value of operations in millions?

Year one frees cash flow-$15, two $10 and third year $40

a. $315
b. $331
c. $348
d. $367

 

Reference no: EM13301574

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