Ilowa Finance plc is considering replacing an old machine with a new machine. The following information is available on the capital structure of Idona Finance. Debt: a) a) 1000 corporate bonds. The bonds have a term of 6 years, face value of $100, and an annual coupon of 8%. The next coupon payment is due in one year's time. The market yield of doon Finance's debt is 5%. b) Long-term loans of $350000 with a fixed interest rate of 3% Equity: a) 35000 ordinary shares outstanding. Ilona has just paid dividend of $1.4 per share and the constant growth rate of the dividend is 5%. The required rate of return on Idona Finance's ordinary shares is 12%. b) 10000 preference shares outstanding at a current price of $15.00 and a fixed rate of return of 10% The corporate tax rate is 40%. Estimated after tax project cash flows are as follows: eare 1 of 2 Assume that this project is of average risk for the firm. Bequired: 1. Evaluate the project using the NPV and the IRR methods 2. Comment your results? Which assumptions should be made, when using WACC for the assessment of investment projects