1. Go to Nasdaq (wWW.nasdaq.com) and get the quote for Toyota (symbol: TM). 1. Click on the Income statement. The income statements for the last three flscal years will appear. Copy and paste the data into Excel. 2. Go back to the Web page and select "Balance Sheets" from the top of the page. Repeat the download procedure for the balance sheets, then copy and paste them Into the same worksheet as the income statements. 2. Create a timellne in Excel with the free cash flows for the 10 years of the project. 3. Determine the WACC using Eq. 18.1. 1. For the cost of debt, rD 1. Go to 1 inra-markets.morningstar.com/BondCenter;Default.JEp and cllck to search. Enter Toyota's symbol, select the Corporate toggle, and press "Enter:" 2. For the cost of equity. 2E 1. Get the yleid on the 10-year U.S. Treasury Bond from Yahoo! Flnance (finance.yahoo.com). CIlck on "Market Data" then cllck on "US Treasury Bond Rates." Enter that yleid as the risk-free rate. 2. Find the beta for Toyota from Yahoo! Finance. Enter the symbol for Toyota and cllck "Statistlcs." The beta for Toyota will be listed there. 3. Use a market risk premlum of 4.50% to compute rE using the CAPM. If you need to, repeat the exercise to compute rD 3. Determine the values for E and D for Eq. 18.1 for Toyota and the debt-to-value and equlty-to-value ratios. 1. To compute the net debt for Toyota, add the long-term debt and the short-term debt and subtract cash and cash equlvalents for each year on the balance sheet: 3. Compute Toyota's enterprise value at the end of each fliscal year by combining the values cotalned for its equity market capitallzation and its net debt. 4. Compute Toyota's debt-10-value ratio at the end of each year by olvding its net debt by its enterprise value. Use the average ratio from the last four years as an estimate for Toyota's target debt-to-value ratio. 4. Determine Toyota's tax rate by dlviling the Income tax by earnings betore tax for each year. Taike the average of the three rates as Toyota's marginal corporate tax rate. 5. Compute the Wacc for Toyota using Eq. 18.1. 4. Compute the NPV of the hybrld engine expansion given the free cash flows you calculated using the WACc method of valuation. 5. Determine the NPV using the Adjusted Present Value Method, and also using the Flow-to-Equity method. In both cases, assume Toyota maintalns the target leverage rato you computed In Questlon 3c. 6. Compare the results under the three methods and explain how the resulting NPV5 are achleved under each of the three dilferent methods