Use the following information for Questions 25 - 26: Two desk manufacturers have agreed to merge. By streamlining operations, the merger is projected to generate pretax cost savings of $127 million in the first year, $166 million in the second year, $183 in the third year, and thereafter growing at the rate of inflation. To achieve these cost savings an investment of $480 million must be made at the outset. There is a high probability that these projections will materialize. The discount rate is 6%. Inflation is 2.5 percent. Tax rate is 35%. ------------------- QUESTION 25 The incremental undiscounted after tax cash flow from cost savings for year 2 is: A. $126 B.$166 o C. $82 D. $108 OE. $41 QUESTION 26 1 points Save Answer Assume that your estimate of the target's Enterprise value on a standalone basis, i.e., preacquisition intrinsic value, is $10 billion. Given the information on synergies discussed above, what is the maximum price the buyer can pay without destroying value? A. $10 billion B. $15.1 billion OC. $12.7 billion OD. $11 billion OE. $13.2 billion