Leo's Cars has a beta of 1.6 and its RWACC is 14.1 percent.The market risk premium is 8.2 percent and the risk-free rate is 3.3 percent.The firm's cash flow at Time 3 is $18,400.The cash flows have a 3.5 percent rate of growth.What is the terminal value of the firm at Time 3?
A) $173,584.91
B) $179,660.38
C) $151,004.16
D) $147,399.38
E) $142,414.86
Correct Answer:
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