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You are a consultant to a firm evaluating an expansion of its current business. The cash-flow forecasts (in millions of dollars) for the project are
You are a consultant to a firm evaluating an expansion of its current business. The cash-flow forecasts (in millions of dollars) for the project are as follows: Years Cash Flow 0 100 1-10 +20 On the basis of the behavior of the firms stock, you believe that the beta of the firm is 1.47. Assume that the rate of return available on risk-free investments is 5% and that the expected rate of return on the market portfolio is 15%. What is the project IRR? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. What is the cost of capital for the project? Note: Do not round intermediate calculations. Enter your answer as a
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