ThankCity Corp is financed 45% with debt. 15% with preferred stock and 40% with common stock. It has a $20 million debt issue outstanding with a 5% coupon rate. The debt has semiannual coupons. The next coupon is due in six months, and the debt matures in five years. It is currently priced at 95% of the par value. Its preferred stock pays an annual dividend of $3.5 and is priced at $35. It has an equity beta of 1.2. The risk-free rate is 3%, the market risk premium is 8% and Supercity Corp's tax rate is 35%. (Note: for bond calculation, use the Annual Percentage Rate).

A) What is the after tax WACC?

B) If ThankCity Corp is considering opening a new plant which costs $200 million up front, takes two years to build and is expected to produce profits of $50 million at the end of every year of production (starting three years from now). The cash flows are expected to last forever. Calculate the NPV of this investment opportunity using after-tax WACC in (a). Will you accept this project or not?