Penn Corporation is analyzing the possible acquisition of Teller Company. Both firms have no debt. Penn believes the acquisition will increase its total aftertax annual cash flow by $ million indefinitely. The current market value of Teller is $ million and that of Penn is $ million. The appropriate discount rate for the incremental cash flows is percent. Penn is trying to decide whether it should offer percent of its stock or $ million in cash to Tellers shareholders.

a

What is the cost of each alternative? Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole number, eg

b What is the NPV of each alternative? Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole number, eg