Molten gold brewery makes the best beer in the region. You have been following the company's performance for you have set your heart on acquiring it. It looks as if the company would be to generate expected cash flows of $10,000 from here to eternity, albeit this uncertain. (Hint1: calculate the discount rate;Hint 2: cash flows are perpetuity)

A) you believe that molten beta is 0.4. How much is the firm worth to you if the risk-free rate is 4% and the expected rate on the market portfolio is 11% (Hint: Price=cash/r)

B) if the actual beta is 0.6, how much will you overvalue the company? ( Hint: same as above )