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Consider a project lasting one year only. The initial outlay is $1,000 and the expected inflow is $1,270. The opportunity cost of capital is
Consider a project lasting one year only. The initial outlay is $1,000 and the expected inflow is $1,270. The opportunity cost of capital is r = 0.27. The borrowing rate is rp = 0.09, and the tax shield per dollar of interest is Tc = 0.21. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Leave no cells blank - be certain to enter "O" wherever required. a. What is the project's base-case NPV? b. What is its APV if the firm borrows 40% of the project's required investment? a. Base-case Net present value b. Adjusted present value
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