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Capital Brodreting Assignment You recently went to work for CTC Components Company; a supplier of auto repair parts used in the after-market with products from

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Capital Brodreting Assignment You recently went to work for CTC Components Company; a supplier of auto repair parts used in the after-market with products from Daimler AG, Ford, Toyota, and other automakers Your boss, the chief financial officer (CFO), has just handed you the estimated cash flows of a proposed project. Cost of the project: 5110,000 CrC's assets are $600 million, financed through bank loans, bonds, preferred stocks, and common stocks. The tax rate is 40 percent. The amounts are as follows: Bank loans: $100 miltion borrowed at 4% Bondss $200 million, paying 5% coupon with semtannual payments, and maturity of 10 years. CTC sold its $1,000 par-value bonds for 51010 and had to incur a $10 flotation cost per bond. Preferred Stockst $100 milian, paying $7 dividends per share. CTC sold its preferred shares for 5110 and had to incur 510/ share flotation cost. Common Stocks: $200 million, beta is 2, the risk-free rate is 2 percent, and the markat rate is 6%. a) What is the after-tax cost of the loans? b) What is the after-tax cost of the bonds? c) What is the after-tax cost of the preferred stociss? d) What is the after-tax cost of the common stocks? e) Calculate the cost of capital. Please show your work precisely by indicating each component and weight. f) Calculate the NPY, IRR, and payback period of the project. Use the cost of capiral you found in "e" when calculating the NPV and IRR. Should you accept or reject the project? Why

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