annually. What is the market price of a 1,000 face value bond if the yield to maturity is 6.8%? 4) If the equivalent annual rate is 8.2432%, what is the nominal rate if it's compounded quarterly? Von Barry's Shop has asked you to make a recommendation for an investment proposal they have been looking at and trying to decide on. The investment is for new equipment to build a new product with a total cost of $7,500,000 including $10,000 shipping costs and $40,000 testing. Barry is also planning to throw a big celebration if the investment is successful for $20,000. This new equipment will require an increase in inventory of $100,000 from day one of the proposal. All other assets of the company are remaining the same. Sales of this new product will be $15,000,000 per year with COGS estimated at 80% of sales. All other expenses are staying the same as before. Barry's Shop WACC is 14% and their marginal tax rate is 37%. The new equipment will have a CCA rate of 20% and there will be other assets in this class when the project ends in four years. The salvage value of the equipment will be $400,000 in four years. Assume the risk profile of the proposal is the same risk profile of Barry's Shop. Assume you are going to use the NPV method to make your recommendation. Required Based on the NPV method, should Barry's Shop go ahead with the new equipment? Round all dollar amounts to the nearest dollar. Show all your work, including any schedules and calculations. (20 marks)