The following are forecasted residual operating income (ROPI) for Reed Corporation for 2017:

The following are forecasted residual operating income (ROPI) for Reed Corporation for 2017:

Current

Forecast Horizon

Terminal

($millions)

2017

2018

2019

2020

2021

Year

Residual operating income (ROPI)

$2,499

$2,624

$2,755

$2,893

$3,038

$3,099

Assume a discount rate of 6%, an expected terminal growth rate of 2%, 2017 NOA of $29,896, and 2017 NNO of $17,314. 

What is the firm's equity value using the ROPI valuation model?

Select one:

A. $71,130

B. $53,816

C. $67,988

D. $17,314

E. None of the above