Two ambitious Windsor Odette business graduates, Dylan and Blake, are considering start their new business by purchasing Fantasy Car Technology, an automobile technology development company. Forecasted annual sales for the next year are $$20$ million, with operating costs equal to $60\%$ of sales, depreciation is $6\%$ of sales, the tax rate is $35\%,$ and required annual investment in equipment is $7\%$ of sales. Sales, costs, and investments are expected to grow $5\%$ in perpetuity. Based on their analysis of the IT industry, Dylan and Blake anticipate financing their company with $30\%$ debt. The required rate of return on the debt will be $4\%$ and the required rate of return on the equity will be $10\%.$ Fantasy Car Technology$$s corporate tax rate is $35\%.$ The risk$-$free interest rate is $2\%$ and the market risk premium is $6\%.$Part A: What is the maximum price Dylan and Blake should be willing to pay for Fantasy Car Technology? Explain your answer.

Part B: An international car company, Peugeot, is also considering making an offer for Fantasy Car Technology. The beta of Peugeot is $1\mathrm{.}1,$ its cost of debt is $5\%,$ it is $40\%$ debt$-$financed, and it has a $35\%$ tax rate. What is the maximum price that Peugeot should be willing to pay for Fantasy Car Technology? Assume that Peugeot$$s forecast for Fantasy Car Technology$$s cash flows is the same as Dylan and Blake$$s$.$ Explain your answer.