14. Beall's department store, is considering purchasing a smaller chain, Russell's, that currently has no debt. Beall's analysts project that the merger will result in incremental free cash flows and of $2 million in Year 1, $5 million in Year 2, $7 million in Year 3, and $107 million in Year 4. (The Year 4 cash flow includes a horizon value of $97 million.) The acquisition would be made immediately, if it were undertaken. Russell's pre-merger beta is estimated to be 1.6, and its current tax rate would be 30 percent. The risk-free rate is 3 percent, and the market risk premium is 6 percent. Russell has 12 million common shares outstanding. What is the appropriate rate for discounting the free cash flows? What is the value of Russell's equity to Beall's (per share)