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CrochetCo is considering an investment in a project which would require an initial outlay of $333465 and produce expected cash flows in years 1 through

CrochetCo is considering an investment in a project which would require an initial outlay of $333465 and produce expected cash flows in years 1 through 5 of $86428 per year. You have determined that the current after-tax cost of the firm's capital (required rate of return) for each source of financing is as follows:

Source of Capital

Cost

Weight

Long-Term Debt

5%

48%

Preferred Stock

9%

20%

Common Stock

13%

32%

What is the net present value of this project?

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