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CAT ltd is contemplating acquiring RAT ltd.On a successful acquisition, the incremental cashflows will be as follows: Year: 1-5 Csh Flow (In Millions):2.5 After the

CAT ltd is contemplating acquiring RAT ltd.On a successful acquisition, the incremental cashflows will be as follows: Year: 1-5 Csh Flow (In Millions):2.5 After the fifth year , cash flows are expected to growat an annual rate of 3% forever.If the appropriate discounting rate is 10%, how much should CAT Ltd pay in order to acquire RAT Ltd?

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