current bete is 1.10 (i.e, based on its target capial atructure), Vandeli's debt interest rate is 7.45. Assume that the rak. free rate of intereat is 24 and the market riak premiam is 5.5. Beth Vandeil and Hastings face a 35% tax rate. Hastings Corperation estimates that if it acquires Vandel Corporation, synergies will cause Vandeli's free cash flows to be $2.3 million, $2.8 milion, 53.3 milian, and $3.64 milion at Yean 1 through 4, respectively, afer which the free cash fows will grow at a constant 5% rate. Himings glans to assuthe Vandelis 511.39 miton in that fuhich has a 7.4% interest rate) ond ralse additionsi debt finanding at the time of the aceulition. Mostings eatimates that interest payments will be 11.6 esifien each year for Years 1 , 2 , and 3 . After Year 1,3 target capital structure of 305 debt will be maintained. Interest at Yoor 4 ails be 51.403 milloo, atter which the interest and the tax shield will grow of 5%. a. What is Vandeili pee-acquisitioo levered cost of equity? What is its unievernd cost of equity? Do not round intermeterate caloulatisns, Round your ansaers to tag decmal plares. Fre-acquivtion levered cost of equity: Unlevered cost of equity: b. Whot is the intrinsic unlevered value of operations at t=0 (atsuming the syneryes are realled)? Do not round intermediate calculatises. Round your antwer to the nearest cent. 3 c. What is the value of the tax shields at t=07 Do not feund intermiediate calculations. Enter your answer in milions. For example, an answer of 31.23 misan should be entered as 1.21, not 1,230,000. Round your answer to two decimal places. 1 mision d. What is the total intrinsic value of operations at t=0 ? What is the intrinske value of Vandein equity to leastiegs? What is Vandelis ietraisic stock price ber ahare? Do not round intermediate calculations. finter your answers for the value of operations and the equify value to acquirer in milloes, for example, an answer of st. 23 malion shouid be entered as 1.23, not 1,230,000. Round your answers to two decimal placks. Walue of operations: 1 Gquily value to acquirer: 1 Intrinsic stock price per share: 5