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please complete each sub-question fully Harbor Co. has produced boat supplies for over 20 years. The company currently has a debt-equity ratio of 65 percent
please complete each sub-question fully
Harbor Co. has produced boat supplies for over 20 years. The company currently has a debt-equity ratio of 65 percent and the tax rate is 24 percent. The required return on the firm's levered equity is 13 percent. The company is planning to expand its production capacity. The equipment to be purchased is expected to generate the following unlevered cash flows: The company has arranged a debt issue of $9.9 million to partially finance the expansion. Under the loan, the company would pay interest of 6 percent at the end of each year on the outstanding balance at the beginning of the year. The company also would make year-end principal payments of $3,300,000 per year, completely retiring the issue by the end of the third year. A Question 9 (8 points) Factake question What is the unlevered cost of equity (ru) ? - Round the answer to two decimals without the percentage sign, i.e., type 12.35 for a 12.34567% answer. Your Answer: Answer A Question 10 (8 points) Rctalke question What is the value of the unlevered project (VU)? - Round the answer to an integer. Your Answer: Answer A Question 11 (8 points) Retake question What is the value of the present value of interest tax shield PV(ITS)? - Round the answer to an integer. Your Answer: Answer A Question 12 (8 points) Rctalike question What is the present value of the project (VL)? - Round the answer to an integer. Your Answer: Answer A Question 13 (8 points) Retale question What is the net present value of the project (NPV)? - Round the answer to an integer. YourStep by Step Solution
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