A 3-year project will cost $350 at the end of year 1 and is expected to produce operating profit before depreciation and amortization (EBITDA) of $110 in year 1, $108 in year 2, and $150 in year 3. Depreciation, both real and financial, will be calculated using straight-line depreciation over 3 years. The cost of capital is 8%, and the firms marginal tax rate is 25%. Assume the firm will issue $45 of debt with an expected interest rate of 6%. Interest must be paid each of the 3 years, and the principal is repaid at the end of year 3. What is the project NPV? (Ignore any tax laws allowing the carry forward or carry back of net operating losses.)

Group of answer choices

(18.0)

(6.8)

(9.7)

7.4