Jason Corporation is considering whether it should acquire Clara Corporation or not. Both firms are all-equity financed. The current market capitalization of Jason Corporation is $500,000. There are 10,000 outstanding shares in Clara Corporation with a share price of $20.Jason Corporation expects that the acquisition would create an incremental cash flow of $4,000 per year indefinitely with an appropriate discount rate of 10%.

b) The Chief Financial Officer (CFO) of Jason Corporation is considering a cash offer of $250,000 for the acquisition of Clara Corporation. (i) Is this offer attractive to Jason Corporation? Explain it with calculation. c) The Chief Executive Officer (CEO) ofJason Corporation is considering an offer of providing 30% of the shares in the combined firm to the shareholders of Clara Corporation for the acquisition. (i) Calculate the equivalent dollar cost of this stock offer (stock payment). (ii) Calculate the net present value of this stock offer.