a. What is the cost of debt for the firm?

b. What is the WACC for the firm?

c. What is the NPV of the project? (Express answer in millions, so 1,000,000 would be 1.00)

Big Tuna Incorporated is trying to value a new project for their company. The project will continue the firm's capital structure of 40.00% debt and 60.00% common stock. The firm has four bond issues outstanding currently, and has a beta of 1.01. The firm also knows that the current risk free rate in the economy is 3.00%, the market portfolio risk premium is 7.00%, and their marginal tax rate is 34.00%. Information on the company bonds is shown below: BOND ISSUE MARKET VALUE (in millions) Yield to Maturity (%) $58.00 6.62% $53.00 7.15% $52.00 5.97% $66.00 5.15% The firm plans a project that will cost $34.00 million today, and will generate yearly cash flows of $6.00 million into the foreseeable future