Assume that Walmart is considering the acquisition of Target: Pre-acquisition Debt ratio Beta Cost of debt Effective tax rate Target 30% Walmart 40% 1.3 1.3 5.4% 7.8% 26% 36% Walmart would have to consolidate Target's net income and pay taxes at its own effective tax rate of 36%. Walmart would also increase Target's debt ratio to 50%, which will increase Target's beta to 1.4. The expected cash flows from Target including all synergies are given below: Cash flow Year ($ million) 1 550 620 670 2 3 After year 3, cash flows are expected to grow by 3% per year forever. The expected return on the S&P 500 (the market portfolio) is 6% and the risk-free rate is 3%. Part 1 BAttempt 1/10 for 10 pts. What is the appropriate discount rate that Walmart should use to discount the cash flows from the Target acquisition? 3+ decimals Submit Part 2 What is the value of Target to Walmart (in $ million)? 0+ decimals B Attempt 1/10 for 10 pts.