Corporate Finance Assignment/ Professional Essay Writers
May 8th, 2020
Expanded Corporation is evaluating a proposed project that requires an initial outlay of $2,000,000. It is estimated that the after-tax cash inflows from the project will be $210,000 annually in perpetuity. Expanded is financed 40% with debt, the firm’s cost of equity is 13%, its pre-tax cost of debt is 8%, and the tax rate is 35%. Assume the project is of similar risk to the firm’s existing operations. What is the NPV of the proposed project?
Select one:
a. $98,542.
b. $65,990.
c. $138,034.
d. $125,506.
e. $33,966. Get Finance Help Today
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