Your firm has an average-risk project under consideration. You choose to fund the project in...
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Your firm has an average-risk project under consideration. You choose to fund the project in the same manner as the firm's existing capital structure. If the cost of debt is 9%, the cost of preferred stock is 12% and the cost of common stock is 16%, and the WACC adjusted for taxes is 14%, What is the NPV of the project given the expected cash flows listed below? K=thousand or 50K= $50,000 Time 0 1 N 2 3 Investment -$2,000,000 NWC -$250,000 250K Operating Cash Flows $850K 850K 850K Salvage 50K A) B) $499,604 C) $2,175.879 D) $2,479,604
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