Pellix ASA has an investment beta of 1.3. Risk-free interest rate is 4%, and expected return on the market portfolio is 11%. Corporation tax is 27%, creditors and owners do not pay tax. The company is considering investing in a project that is expected to generate an annual cash flow from operations of NOK 4 million after tax for 3 years. The project is assumed to have the same risk as the company. The investment costs NOK 8 million and is 40% loan-financed. The debt cost is 5%, and the loan is repaid in full at the end of the third year.

What is the net present value of the investment if the investment is 100% equity financed?