Question 6 10 pts Private information, held only by insiders, is never reflected in a firm's stock price until it is announced publicly. True False Question 7 10 pts The cellarmaster at a large public winery accidentally added arsenic instead of argon to a batch of merlot and accidentally killed some of their customers. Between the lawsuits and reduced sales, its future expected free cash flow will decline by $20 million in the first year and then $10 million per year for the next 5 years after that. Assume the firm has 10 million shares outstanding, no debt, and an equity cost of capital of 8%. If this news came as a complete surprise to investors (semi-strong form efficiency), how much will the winery's stock price drop upon the announcement of this event? Question 8 10 pts You founded your own firm three years ago. You initially contributed $100,000 of your own money and in return you received 2 million shares of stock. Since then, the form sold an additional 1 million shares of stock to angel investors and is now considering raising capital from a venture capital firm This venture capital firm would invest $4 million and would receive 2 million newly issued shares in return. The post-money valuation of your firm is closest to