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8. A Company is planning to buy B Company. The acquisition would require an initial investment of $300,000, but in one year B Company's after-tax
8. A Company is planning to buy B Company. The acquisition would require an initial investment of $300,000, but in one year B Company's after-tax net cash flows would increase by $25,000 and remain at this new level annually forever. Assume a cost of capital of 8.5 percent. Should the acquisition happen?
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