The company would have to pay a call premium of $6\mathrm{.}0$ percent on the old issue and underwriting cost on the new $$8$ million issue is $$300,000.$ The company is in a $40\mathrm{.}0$ percent tax bracket, and there will be an overlap period of $1$ month. Treasury Bills currently yield $3\mathrm{.}0$ percent per year.

$[1]$

Required:

Compute the Net Present Value of the refund decision and answer the question on whether or not the bond should be refunded.

Enter the discount rale with two decimal places. $($e$.$g$.12\mathrm{.}34\%)$

Round all cash flow numbers to zero decimal places.

Enler cash outflows as negative numbers.

Enter 'Nel' numbers for each cash flow $($e$.$g enter underwriting costs; net of tax$).$