Northern Frontier Corporation (NFC) is deciding whether to refund an old bond issue of 125,000,000. The 11.4 percent coupon bonds pay interest annually and mature in eight years. A new issue of 125,000,000 of 8 year bonds can be sold with a coupon rate of 8.2 percent. with interest paid annually. NFC would pay a call premium of 6.8 percent to refund the old bonds and would incur flotation costs of 11,500,000 associated with the new bond issue. The corporate tax rate is 35 percent and NFC expects that there will be a two-month overlap during which any funds can be invested in T-Bills yielding 1 percent. Should NFC proceed with the refunding decision? Please explain in all four working steps clearly.