is fully depreciated at the end of the year, so without leverage you would owe taxes on the difference between the project cash flow and the investment, that is$,$ $$18.$

a$.$ Calculate the NPV of this investment opportunity using the APV method.

b$.$ Using your answer to part $($a$),$ calculate the WACC of the project.

c$.$ Verify that you get the same answer using the WACC method to calculate NPV$.$

d$.$ Finally, show that flow$-$to$-$equity method also correctly gives the NPV of this investment opportunity.