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ou are given the following data for a project that is to be evaluated using the APV method. Year 0 1 2 3 EBIT $127,000
ou are given the following data for a project that is to be evaluated using the APV method.
Year | 0 | 1 | 2 | 3 |
EBIT | $127,000 | $133,000 | $138,500 | |
CAPEX | $60,000 | $40,000 | $10,000 | |
Depreciation | $72,000 | $80,000 | $84,000 | |
Increase in NWC | $50,000 | $60,000 | $30,000 | |
Year-end net debt | $80,000 | $100,000 | $140,000 | $140,000 |
Cost of net debt = 8%
Unlevered cost of capital = 11.8%
Corporate tax rate = 30%
Calculate the total value of the project at t = 0, using the APV method.
Group of answer choices
$185,617
$193,822
$213,918
$201,765
$222,872
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