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Ramblin Wreck is a firm specializing in engineering components. The firm is publicly traded and is considering the following project: The project will last 5
Ramblin Wreck is a firm specializing in engineering components. The firm is publicly traded and is considering the following project:
The project will last years with an annual cash flow of $ million. The project will require an initial investment of $ million
The firm must determine the cost of capital to evaluate the project. The project is within the firms normal activities
Ramblin Wreck, Inc. Financial Data:
STOCK DATA: BOND DATA:
Current Price Per Share $ Current Price Per Bond $
# of Shares million # of bonds
Book Value $ million Annual Coupon Rate
Face Value Per Bond $
Maturity years
The risk free rate in the economy is currently while investors have a market risk premium of Ramblin Wreck, Inc. has a beta of The tax rate is
What is the NPV of the project? express in millions, so would be
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Answer format: Currency: Round to: decimal places.
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