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A company is considering an investment project that generates a cash flow of $29,000 next year if the economy is favorable but generates only $7,200

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A company is considering an investment project that generates a cash flow of $29,000 next year if the economy is favorable but generates only $7,200 if the economy is unfavorable. The probability of favorable economy is 60% and of unfavorable economy is 40%. The project will last only one year and be closed after that. The cost of investment is $20,000, and the company plans to finance the project with $9,500 of equity and $10,500 of debt. Assuming the discount rates of both equity and debt are 04. What is the expected cash flow to the company's creditors if it invests in the project? SO $9,180 $10,500 $13,720 $8,060

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