If luncent maintains its leverage ratio , what is the debt capacity of the project at each year ? #2 Perform NPV analysis using APV method

5. (20 pts) Suppose Lucent has cost of equity , equity mar debt 4 billion and o.4 billion of excess amount of cash. Suppose marginal tax rate is 35% (Note: Use Net Debt concept (ND) and of 9%, equity market capitalization of $10billion, and total t concept (ND) and leverage ratio ND/(ND+E)). #Question 1 (5pts): What is Lucent's WACC ( after tax)