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Please i need help now! Top Care is a company that offers residential health care services. The company has $150 million in interest-bearing debt (in

Please i need help now!

Top Care is a company that offers residential health care services. The company has $150 million in interest-bearing debt (in book value and market value terms). The firm has 25 million shares trading at $15 a share, and the unlevered beta of firms in the health care business is 1.3. The firm has a current rating of B, with a default spread of 0.05 over the risk free rate. The risk free rate is 0.045, the equity risk premium is 0.04 and the corporate tax rate is 40%.

Top Care is considering making a new investment of $ 1000000 and has come with the following estimated revenues are$4000000 , operating expenses $650000, depreciation $250000 per year. The project will end after four years. This project will require Top care to maintain working capital at 20% of revenues occurring at the beginning of each year and the working capital being recovered at the end.

Estimate the debt to capital ratio for the firm.

Estimate the debt to equity ratio for the firm.

What is the beta levered for the firm?

Estimate the before tax cost of debt for the firm.

Estimate the after tax cost of debt for the firm.

Estimate the cost of equity for the firm.

Estimate the weighted average cost of capital for the firm.

Estimate the annual EBIT to the firm to Top Care on this investment. (You have to do it only once, since the revenues and expenses flows are the same every year)?

Estimate the FCFF on the project for year 1. -> Hint: FCFF= EBIT(1-t) + depreciation - capex +or- change in net working capital Answer for part 9 ?

Estimate the FCFF on the project for year 2.

Estimate the FCFF on the project for year 3.

Estimate the FCFF on the project for year 4.

Estimate the initial investment.

Estimate the NPV of the project.

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