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As a result of the Federal Reserves aggressive approach in the 2022 scenario above (5.75%. cost of debt and 3.75% risk-free rate), ABC decides to
As a result of the Federal Reserves aggressive approach in the 2022 scenario above (5.75%. cost of debt and\ 3.75% risk-free rate), ABC decides to fund the project with 100% debt.\ 1) Using Excel, calculate: WACC and NPV manually (discounting each cash flow for NPV), as shown in the\ lecture video.\ 2) Using Excel, calculate IRR.\ 3) Is there a concern with leveraging debt on a routine basis for all future capital projects? Explain. Will\ this take a toll on the companys net income? Explain. How do you think shareholders will react?\ Explain.
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