Question
A new project is expected to have EBIT of $160k for Year 1, $125k for Year 2, $135k for Year 3, the initial investment is
A new project is expected to have EBIT of $160k for Year 1, $125k for Year 2, $135k for Year 3, the initial investment is $250k. The company has target debt/equity ratio of 0.835, cost of equity is 15.5 and its pre-tax cost of debt is 9%. The tax rate is 29%. Calculate the NPV.
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Analysis For Financial Management
Authors: Robert Higgins
7th Edition
0072863641, 9780072863642
