Given are the following data for Outsource Company: PV (of FCFs for years 1-3)= $35 million; PV (horizon value)= $65 million. Calculate the value of the firm.
A)$100 million
B)$65 million
C)$30 million
D)$170 million

Question

Quizplus · Accepted Answer

The value of the firm is calculated by adding the present value (PV) of the free cash flows (FCFs) for years 1-3 ($35 million) to the present value of the horizon value ($65 million), which equals $100 million.

Given Are the Following Data for Outsource Company: PV (Of