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QUESTION
Barnette Inc.'s free cash flows are expected to be unstable during the next few years while the company undergoes restructuring. However, FCF is...
Barnette Inc.'s free cash flows are expected to be unstable during the next few years while the company undergoes restructuring. However, FCF is expected to be $81 million in Year 5, i.e., FCF at t = 5 equals $81 million, and the FCF growth rate is expected to be constant at 6% beyond that point. If the weighted average cost of capital is 15%, what is the horizon value (in millions) at t = 5?
