The Wonka Co. is all-equity financed and has the following free cash flows in years 1−3: $2.5 million ($2.5M), $3.6M, and $4.8M. After year 3, the firm is expected to grow at a sustainable rate of 2.7 percent per annum. With a WACC of 11.3 percent, what is the horizon value in year 3 of Wonka Co?

Answer rating: 100% (QA)

To calculate the horizon value in year 3 of Wonka Co we need to determine the present value of all f... View the full answer