Clearly answer the 3 questions in the text box below. Show your work on the calculation. Hollow Corp estimates that if it acquires Solid Company, synergies will produce Solid's free cash flows at $3 million annually with non-constant growth. Hollow would assume Solid's $10.19 million in debt (which has an 8% interest rate). A target capital structure of 30% debt will be maintained. Solid currently has 1.5 million shares outstanding and a current beta is 1.4. Solid and Hollow each have a 25% combined federal-plus-state tax rate. The risk-free rate is 5% and the market risk premium is 6% Questions 1. Assume Solid Comapny is the major supplier of metal to Hollow Corp, who produces small aircraft. The type of merger between Hollow and Solid would be 2. If non-constant growth is expected, which model will be more appropriate? APV model or Corporate FCF model? 3. If the value to Hollow (acquirer) is $39.29 million, what is the maximum price per share that Hollow should offer Solid's shareholders? Clearly answer the 3 questions in the text box below. Show your work on the calculation. Hollow Corp estimates that if it acquires Solid Company, synergies will produce Solid's free cash flows at $3 million annually with non-constant growth. Hollow would assume Solid's $10.19 million in debt (which has an 8% interest rate). A target capital structure of 30% debt will be maintained. Solid currently has 1.5 million shares outstanding and a current beta is 1.4. Solid and Hollow each have a 25% combined federal-plus-state tax rate. The risk-free rate is 5% and the market risk premium is 6% Questions 1. Assume Solid Comapny is the major supplier of metal to Hollow Corp, who produces small aircraft. The type of merger between Hollow and Solid would be 2. If non-constant growth is expected, which model will be more appropriate? APV model or Corporate FCF model? 3. If the value to Hollow (acquirer) is $39.29 million, what is the maximum price per share that Hollow should offer Solid's shareholders