Please answer all questions - 1- There is a firm, which we are prospecting as a purchase candidate. It has the following features we find attractive. First, it will enable us to sell to the clients of this firm what we already are selling our existing clients. The revenue addition will be $12 million. However, it will induce $3 million more expenses in attaining that higher level of revenue. Secondly, it will enable us to sell a division of the firm that does not rally connect with our operations for $5 million. Thirdly, since there is a lot of repetition of positions ( we are in the same line of business) we can lay off 50 employees permanently. The average salary of those employees is $60,000. The coc of the firm is 10%. Calculate the amount that we can bid to acquire this company.

2- The P/E ratio is 8. The D/E is 90/10, the tax rate is .20 and the unlevered beta is 3. The net profit margin is .09. Total assets are $100 million and total sales are $60 million. The outstanding shares are 100,000. Derive the price of the stock for next year

3 - We want to compute the price of Pabon. It has 2 m shares outstanding and $80 of book value of equity. Pabon expects to sell $20m worth of sales and have EAT of $5m and keep 40% of its profit. Furthermore, it has $100m of assets. Its short term assets grew by $13 million and short term liabilities by $4 million. Moreover, it has depreciation charges of 5% of its assets. Its coe is .12 and its bheta is 1.2. Calculate Pabons value.

Thank you