Problem:
Akyol Corporation is undergoing a restructuring, and its free cash flows are expected to be unstable during the next few years. However, FCF is expected to be $95 million in Year 5, i.e., FCF at t = 5 equals $95 million, and the FCF growth rate is expected to be constant at 6% beyond that point.
Required:
Question: If the weighted average cost of capital is 12%, what is the horizon value (in millions) at t = 5?
Note: Please show guided help with steps and answer.