Landman Corporation $($LC$)$ manufactures time series photographic equipment. It is currently at

its target debt$-$equity ratio of $0\mathrm{.}60.$ It's considering building a new $$73$ million manufacturing

facility. This new plant is expected to generate aftertax cash flows of $$9\mathrm{.}4$ million in perpetuity.

The company raises all equity from outside financing. There are three financing options:

A new issue of common stock: The flotation costs of the new common stock would be $6$

percent of the amount raised. The required return on the company's new equity is $13$ percent.

A new issue of $20-$year bonds: The flotation costs of the new bonds would be $3$ percent of the

proceeds. If the company issues these new bonds at an annual coupon rate of $7$ percent, they

will sell at par.

Increased use of accounts payable financing: Because this financing is part of the company's

ongoing daily business, it has no flotation costs, and the company assigns it a cost that is the

same as the overall firm WACC. Management has a target ratio of accounts payable to long$-$

term debt of $0\mathrm{.}15.($Assume there is no difference between the pretax and aftertax accounts

payable cost.$)$

What is the NPV of the new plant? Assume the tax rate is $21$ percent.