Probleman analyst predicted the free cash flows for acme, Ask an Expert

Finance

Problem:

An analyst predicted the free cash flows for ACME Corporation for the next four years:

Year	Free Cash Flow
2009	10 million
2010	15 million
2011	22 million
2012	30 million

After 2012, the free cash flows are expected to grow at an annual rate of 5%. If the WACC of XYZ Corp is 12%, what is the enterprise value of the firm?

A. $341.59 million

B. $56.56 million

C. $331.62 million

D. $308.04 million

Additional Information:

This question is basically belongs to the Finance as well as it is about computation of value of the firm using cash flows.

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