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First and Goal Corporation s stock returns have a covariance with the market portfolio of . 0 4 8 7 . The standard deviation of
First and Goal Corporations stock returns have a covariance with the market portfolio of The standard deviation of the returns on the market portfolio is percent and the expected market risk premium is percent. The company has bonds outstanding with a total market value of $ million and a yield to maturity of percent. The company also has million shares of common stock outstanding, each selling for $ The companys CEO considers the firms current debtequity ratio optimal. The corporate tax rate is percent and the riskfree rate is percent. The company is considering the purchase of additional equipment that would cost $ million. The expected unlevered cash flows from the equipment are $ million per year for five years. Purchasing the equipment will not change the risk level of the firm.
Calculate the NPV of the project. Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to decimal places, eg
i tried but it was wrong
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