Schooner Shipyards is contemplating an acquisition target. Schooner want to estimate its maximum acquisition price at an 8 percent discount rate and a terminal value in year 5 based on the perpetual growth equation with a 4 percent growth rate. The following table shows the projected free cash flows of the target. ________________________________________________________________________ Year 1 2 3 4 5 Free Cash Flow -800 -400 0 200 700 ________________________________________________________________________ Answer the following three questions: a. Estimate the targets maximum acquisition price. b. Estimate the targets maximum acquisition price when the discount rate is 7 percent and the perpetual growth rate is 5 percent. c. Considering your answers to parts (a) and (b) of this question, what is the percentage change in the maximum acquisition price when the discount rate is reduced one percentage point and the perpetual growth rate is increased one percentage point?