Insell Pharmaceuticals is considering the acquisition of Fourier Generics, Inc., which is in a related line of business. Fourier Generics presently has a cash flow of $$2$ million per year. With a merger, synergism would be expected to result in a growth rate of this cash flow of $15$ percent per year for $10$ years, at the end of which level cash flows would be expected. To sustain the cash$-$flow stream, Insell will need to invest $$1$ million annually. For purposes of analysis and to be conservative, Insell limits its calculations of cash flows to $20$ years.

a$)$ What expected annual net cash flows would Insell realize from this acquisition?

b$)$ If its required rate of return is $18$ percent, what is the net present value of the net cash flows for the acquisition?

c$)$ Should Insell proceed with the acquisition? Why or why not?