Question 3 Consider The Timing And Size Of The Incremental After Tax Cash Flows For An All Equity Firm Are As The Follow 1 (54.82 KiB) Viewed 103 times
(Please type no handwriting) QUESTION 3 Consider the timing and size of the incremental after-tax cash flows for an all-equity firm are as the following: -$1,000 $125 $250 $375 $500 0 1 2 3 4 Assuming the unlevered cost of equity capital is 6.5%. Required: (a) Calculate the firm project using the adjusted present value model. (b) If firm finances the project with $450 of debt at 7.2% and tax rate is 30%, calculate the new firm project using adjusted present value model.
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