What is this firms common stock worth

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Reference no: EM13909324

A firm is anticipated to produce a $10,000 cash flow in year 1, $2,500 cash flows in years 2 through 4, and then will pay a steady stream of $1,250 cash flows into the foreseeable future (i.e. forever). Also, the firm has a weighted average cost of capital of 10%. Also suppose that this firm has $5,000 in preferred stock and $10,000 in long term debt. What is this firm's common stock worth?

Reference no: EM13909324

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