Suppose Yong Sung Corporation's free cash flow during the just-ended year (t = 0) was $100
million, and FCF is expected to grow at a constant rate of 5% in the future. If the weighted average
cost of capital is 15%, what is the firm's value of operations, in millions?
The firm's value of operations is given as the present value of free cash flows. Since the free cash flows ...
The solution explains how to calculate the value of operations for a firm.