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Big Ltd is considering a cash acquisition of Small Ltd. for $2.7 million. Small Ltd. will provide the following pattern of cash inflows and synergistic

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Big Ltd is considering a cash acquisition of Small Ltd. for $2.7 million. Small Ltd. will provide the following pattern of cash inflows and synergistic benefits for the next 20 years. There is no tax loss carry-forward. The cost of capital for the acquiring firm is 10 percent. a. Calculate the net present value. (Use a Financial calculator to arrive at the answers. Ensure to provide the answer in whole dollars, not in millions. Do not round intermediate calculations. Round the final answer to nearest whole dollar. Omit $ sign from the answer value. Negative answer should be indicated by a minus sign.) Net present value $ b. Should the merger be undertaken? No Yes

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