Due to the highly specialized nature of the electronic industry, Barrett Industries invests a lot of money in R&D on prospective products. Consequently, it retains all of its earnings and reinvests them into the firm. (In other words, it does not pay any dividends.) At this time, Barrett does not have plans to pay any dividends in the near future. A major pension fund is interested in purchasing Barrett's stock, which is traded on the NYSE.

The treasurer of the pension fund has done a great deal of research on the company and realizes that its valuation must be based on the total company model. The pension fund's treasurer has estimated Barrett's free cash flows for the next 4 years as follows: $3 million, $6 million, $10 million, and $15 million. After the fourth year, free cash flow is projected to grow at a constant 7 percent. Barrett's WACC is 12 percent it has $60 million of total debt and preferred stock, and 10 million shares of common stock.

a. What is the present value of Barrett's free cash flows during the next 4 years?

b. What is the company's terminal value?

c. What is the total value of the firm today?

d. What is Barrett's price per share?