Question 4 (6 points) You are considering acquiring a firm that you believe can generate expected cash flows of $20,000 a year forever. However, you recognize that those cash flows are uncertain. a. With a beta of.8, how much is the firm worth if the risk-free rate is 4% and the expected market risk premium is 8%? (2 marks) b. If it turns out that the beta is actually .7: i. Did you overvalue or undervalue the firm? (2 marks) ii. By how much did you overvalue/undervalue the firm? (2 marks)