Penn Corp. is analyzing the possible acquisition of Teller Company. Both firms have no debt. Penn believes the acquisition will increase its total aftertax annual cash flow by $1.9 million indefinitely. The current market value of Teller is $41 million, and that of Penn is $79 million. The appropriate discount rate for the incremental cash flows is 10 percent. Penn is trying to decide whether it should offer 40 percent on its stock of $57 million in cash to Teller's stockholders. a) What is the cost of each alternative? b) What is the NPV of each alternative? c) Which alternative should Penn choose? Input Area: After-tax annual cash flow Teller market value Penn market value Discount rate Stock offer Cash offer Output Area: |a. V*k #DIV/0! Cash cost $ Equity cost #DIV/0! b. NPV cash NPV stock #DIV/0! #DIV/0! C. #DIV/0!