Consider a project to produce solar water heaters. It requires a $10 million investment and offers a level after-tax cash flow of $1.70 million per year for 10 years. The opportunity cost of capital is 11.25%, which reflects the projects business risk. a. Suppose the project is financed with $6 million of debt and $4 million of equity. The interest rate is 7.25% and the marginal tax rate is 21%. An equal amount of the debt will be repaid in each year of the project's life. Calculate APV. b. If the firm incurs issue costs of $590,000 to raise the $4 million of required equity, what will be the APV?