Question: Alpha Industries is considering a project with an initial cost of $8.6 million. The project will produce cash inflows of $2.04 million per year for

Alpha Industries is considering a project with an initial cost of $8.6 million. The project will produce cash inflows of $2.04 million per year for 6 years. The project has the same risk as the firm. The firm has a pretax cost of debt of 5.79 percent and a cost of equity of 11.39 percent. The debt-equity ratio is .66 and the tax rate is 23 percent. What is the net present value of the project? Multiple Choice

a. $558,853

b. $678,075

c. $586,795

d. $651,995

e. $506,837

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