A project has a NPV, assuming all equity financing, of \$500,000. To finance the project, debt is issued with associated floatation costs of \$50,000. The floatation costs can be amortized over the project’s 5 year life. The debt of \$8 million is issued at 10% interest, with principal repaid in a lump sum at the end of the fifth year. If the firm’s tax rate is 25%, calculate the project’s APV.

A project has a NPV, assuming all equity financing, of \$500,000. To finance the project, debt is issued with associated floatation costs of \$50,000. The floatation costs can be amortized over the project’s 5 year life. The debt of \$8 million is issued at 10% interest, with principal repaid in a lump sum at the end of the fifth year. If the firm’s tax rate is 25%, calculate the project’s APV.

A project has a NPV, assuming all equity financing, of \$500,000. To finance the project, debt is issued with associated floatation costs of \$50,000. The floatation costs can be amortized over the project’s 5 year life. The debt of \$8 million is issued at 10% interest, with principal repaid in a lump sum at the end of the fifth year. If the firm’s tax rate is 25%, calculate the project’s APV.

A project has a NPV, assuming all equity financing, of \$500,000. To finance the project, debt is issued with associated floatation costs of \$50,000. The floatation costs can be amortized over the project’s 5 year life. The debt of \$8 million is issued at 10% interest, with principal repaid in a lump sum at the end of the fifth year. If the firm’s tax rate is 25%, calculate the project’s APV.

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