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You are considering an investment in a project that requires an initial outlay of $ 225,000 and will produce after-tax cash flows of $ 35,000
You are considering an investment in a project that requires an initial outlay of $ 225,000 and will produce after-tax cash flows of $ 35,000 per year for the next 15 years. Your firm uses 50 percent debt and 50 percent equity in financing. The after-tax costs of debt and equity are 9% and 15% respectively. What is the firm's WACC? What is the project NPV? Should the project be accepted?
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