Water Corporation plans to make a $50.5 million investment, initially funded completely with debt. The free cash flows of the investment and Water's incremental debt from the project are shown here

Year	0	1	2	3
Free Cash Flows	-50.5	40.1	21.9	23.5
Debt	50.5	29.6	15.8	0.0

Water's incremental debt for the project will be paid off according to the predetermined schedule shown. Water's debt cost of capital is 7.8%, and its tax rate is 34%. Water also estimates an unlevered cost of capital for the project of 11.2%.

a. Use the APV method to determine the levered value of the project at each date and its initial NPV.

b. Calculate the WACC for this project at each date.

c. Compute the project's NPV using the WACC method.

d. Compute the equity cost of capital for this project at each date.

e. Compute the project's equity value using the FTE method.