[Diefett]

The equation that my book gives is

Value of stockholders' equity = FCF1/(1+r)+FCF2/(1+r)^2... +FCFn/(1+r)^n+TVn/(1+r)^n

where FCF1, FCF2, and FCFn denote free cash flows received at the end of future periods. N is the end of the life of the firm.
TV is the terminal value

It gives this simplified equation if free cash flows are equivalent to cash from operations. And the cash flows are the same for all periods.

FCF X ((1-(1+r)^-n)/r)

The inputs are

FCF 500
TV 2000
n 10 years
r 15%

Using the simplified method I had 2509.38
Using the long method I had 3003.75
of course these were rounded.

Can anybody give me some tips?

[Diefett]

ahh, now I see the err of my ways, the simple equation is

FCF*((1-(1+r)^-n)/r) + TV/(1+r)^n

I fixed this and got 3003.75.

Just the same if somebody can check my answer I would be grateful.