Gradient landscaping is thinking about buying a piece of property for a sod farm. They expect $20,000 in free cash flow next year and for cash flows will grow at 3% forever. Gradient maintains a 75% debt ratio and pays 8% pre-tax on their debt and 12% on their equity. Gradient pays taxes at a 30% rate.

What is the unlevered value of this project?

a. $333,333.33

b. $285,714.29

c. $476,190.48