Quantitative Problem 2: Hodley Inc. forecasts the year-end free cash flows in millions) shown below. 2 Year FCF -$22.86 $38.1 $43.5 The weighted average cost of capital is 9%, and the FCFs are expected to continue growing at a 5% rote after Year 5. The firm has $25 million of market value debt, but it has no preferred stock or any other outstanding claims. There are 18 million shares outstanding. Also, the firm has zero non- operating assets. What is the value of the stock price today (Year 0)? Round your answer to the nearest cent. Do not found intermediate calculations. $ 77,51 per share According to the valuation models developed in this chapter, the value that an investor assigns to a share of stock is dependent on the length of time the investor plans to hold the stock The statement above is -Select-true false Adomson Corporation is considering four average-risk projects with the following costs and rates of return Project Cost Expecte Rate of Return $2,000 16.00% 3,000 15.00 5,000 13.75 2,000 12.50 The company estimates that it can issue debt at a rate of rd = 11%, and its tax rate is 25%. It con issue preferred stock that pays a constant dividend of $6.00 per year at $45.00 per shore. Also, its common stock currently sells for $36.00 per shore; the next expected dividend, D1, is $4.25; and the dividend is expected to grow ota constant role of 4% per year. The target copital structure consists of 75% common stock, 15% debt, and 10% preferred stock What is the cost of each of the capital components? Do not round intermediate calculations. Round your answers to two decimal places Cost CHE Notes Hadley Inc. forecasts the year-end free cash flows (in millions) shown below. Year 1 2 3 4 5 FCF -$22.86 $38.1 $43.5 $52 $56.9 The weighted average cost of capital is 9%, and the FCFs are expected to continue growing at a 5% rate after Year 5. The firm has $25 million of market value debt, but it has no preferred stock or any other outstanding claims. There are 18 million shares outstanding. Also, the firm has zero non-operating assets. What is the value of the stock price today (Year O)? Round your answer to the nearest cent. Do not round intermediate calculations. $ per share