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MILUJIRIGY Sub-Prime Loan Company is thinking of opening a new office, and the key data are shown below. The company owns the building that would

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MILUJIRIGY Sub-Prime Loan Company is thinking of opening a new office, and the key data are shown below. The company owns the building that would be used, and it could sell it for $100,000 after taxes if it decides not to open the new office. Under the new tax law, the equipment used in the project is eligible for 100% bonus depreciation, so it will be fully depreciated at t-o. At the end of the project's life, the equipment would have zero salvage value. No change in net operating working capital (NOWC) would be required for the project. Revenues and operating costs would be constant over the project's 3-year life. What is ti project's NPV? (Hint: Cash flows are constant in Years 1-3.) Do not round the intermediate calculations and round the final answer to the nearest whole number. WACC 10.09 Opportunity cost after taxes $100,000 Equipment cost 564,000 Annual sales revenues $131,000 Annual operating costs $40,000 Tax rate 25.0% O a. 521,728 b. 55.728 C. 535,182 d. 534.991 O e. $18.991

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