XYZ Corp. has 10 million shares of common stock outstanding. The common stock currently sells for $50 per share and has a beta of 1.5. XYZ Corp. has 290,000 bonds outstanding and sell for 105% of par value. The ytm (yield to maturity) of the bond is 6% p.a. The market risk premium is 7%. T-bills are yielding 4% p.a and corporate tax rate is 25%. All p.a. rates are EAR. What is the firm's market value capital structure (i.e. Market value of debt/Market value of equity)? What is the firm's cost of capital? If XYZ Corp. is evaluating a new investment project that has an investment of $10 million at year 0 and expected to have a cash flow of $5 million fi Year 1 onwards growing at 5% rate p.a. forever, what is the NPV of the project? [5] nations