4-Consider a project of the Pearson Company. The timing and size of the incremental after-tax cash...

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4-Consider a project of the Pearson Company. The timing and size of the incremental after-tax cash flows for an all-equity firm are $-1000, $265, $530, $515, $500 from year 0 to 4 respectively. The unlevered cost of equity is 30%. a. Calculate the NPV? Should this project be accepted? b. The firm finances the project with $20000 debt at 8% with $100 after-tax flotation costs. Principal is repaid at $1000 per year with added interest. Pearson's tax rate is 50%. The net present value of the project under leverage? Now, Should this project be accepted? 4-Consider a project of the Pearson Company. The timing and size of the incremental after-tax cash flows for an all-equity firm are $-1000, $265, $530, $515, $500 from year 0 to 4 respectively. The unlevered cost of equity is 30%. a. Calculate the NPV? Should this project be accepted? b. The firm finances the project with $20000 debt at 8% with $100 after-tax flotation costs. Principal is repaid at $1000 per year with added interest. Pearson's tax rate is 50%. The net present value of the project under leverage? Now, Should this project be accepted?