uestion 3 (Q26 from BD Chapter 18 Propel Corporation plans to make a $50 million investment, initially funded completely with debt. The free cash flows of the investment and Propel's incremental debt from the project follow: Year Free Cash Flow Debt 0 -50 50 1 40 30 20 15 25 0 Propel's incremental debt for the project will be paid off according to the predetermined schedule shown. Propel's debt cost of capital is 8%, and its tax rate is 30%. Propel also estimates a cost of capital for the project of 10% a) What are the interest payments and interest tax shield cash flows in year 1, 2, and 3? (Hint: Interest paymentt - Debtt-1 X TD-) Year Interest pavment Interest tax shield CF 0 0 0 1 b) What is the unlevered value of the project in year 0? (Hint: This is not an NPV calculation. Do not subtract the initial investment of 50M.) c) Use the APV method to determine the levered value of the project in year 0. (Hint: Remember, interest tax shield cash flows are discounted at the debt cost of capital.)