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Question Help Cash acquisition decision Benson Oil is being considered for acquisition by Dodd Oil. The combination, Dodd believes would increase its cash inflows by

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Question Help Cash acquisition decision Benson Oil is being considered for acquisition by Dodd Oil. The combination, Dodd believes would increase its cash inflows by $30,000 for each of the next 5 years and by $50,000 for each of the following 5 years. Benson has high financial leverago, and Dodd can expect its cost of capital to increase from 13% to 16% if the merger is undertaken. The cash price of Benson is $120.000 a. Would you recommend the merger? b. Would you recommend the merger if Dodd could use the $120,000 to purchase equipment that will return cash inflows of $34,000 per year for each of the next 10 years? a. The net present value of the merger is sl (Round to the nearest cent)

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