Covan, Inc. is expected to have the following free cash flow:

Year	1	2	3	4	...
FCF	10	12	13	14	Grow by 3% per year

a. Covan has 8 million shares outstanding, $4 million in excess cash, and it has no debt. If its cost of capital is 10%, what should be its stock price?

b. Covan adds its FCF to cash, and has no plans to add debt. If you plan to sell Covan at the beginning of year 2, what is its expected price?

c. Assume you bought Covan stock at the beginning of year 1. What is your expected return from holding Covan stock until year 2?

a. Covan has 8 million shares outstanding, $4 million in excess cash, and it has no debt. If its cost of capital is 10%, what should be its stock price?

The stock price should be $__ (Round to the nearest cent.)

b. Covan adds its FCF to cash, and has no plans to add debt. If you plan to sell Covan at the beginning of year 2, what is its expected price?

If you plan to sell Covan at the beginning of year 2, its price should be $__ (Round to the nearest cent.)

c. Assume you bought Covan stock at the beginning of year 1. What is your expected return from holding Covan stock until year 2?

Your expected return from holding Covan stock until the beginning of year 2 is __% (Round to one decimal place.)