Answer the questions based on reading Case #14: Chestnut Foods. Please type answers only!

1. Describe the situation at Chestnut Foods and explain how Chestnut has performed relative to the market. 2. Why is Van Muur soliciting control of Chestnut? 3. Do you agree with Meyer's dinner conversation assertions, why or why not? 4. How does the choice of a constant versus risk-adjusted hurdle rate (reference Figure 14.1) affect the evaluation of Chestnut's two divisions? 1 5. Compare and contrast the WACC of Chestnut foods with a firm in the food processing and a firm in the instruments industry (reference Table 1). Based on the cost of capital, which industry is riskier? 1. Describe the situation at Chestnut Foods and explain how Chestnut has performed relative to the market. 2. Why is Van Muur soliciting control of Chestnut? 3. Do you agree with Meyer's dinner conversation assertions, why or why not? 4. How does the choice of a constant versus risk-adjusted hurdle rate (reference Figure 14.1) affect the evaluation of Chestnut's two divisions? 1 5. Compare and contrast the WACC of Chestnut foods with a firm in the food processing and a firm in the instruments industry (reference Table 1). Based on the cost of capital, which industry is riskier