Company A wants acquire company B. The expected net cash flows from the acquisition for the first 3 years of the post merger are as follows:

Year 1 = 550 000

Year 2 = 650 000

Year 3 = 750 000

After 3 years the net cash flows are expected to grow at 4%. The appropriate discount rate in 10%.

What is the most price that Company A should pay for company B. Show all calculations.