As a small business owner,you have decided to expand your operation.This expansion will require a rather large initial investment,and you are considering whether to finance this investment completely from the business's cash reserves or to partially finance with loan funds from a local bank.

Using the information below,briefly discuss which option (financing with cash, or using the loan) would result in the larger NPV for the project.Include a short explanation/justification for your answer.

Discount Rate10%

Loan interest rate10%

Marginal Tax Rate30%