Question: Alpha Industries is considering a project with an initial cost of $91 million. The project will produce cash inflows of $2.13 million per year for
Alpha Industries is considering a project with an initial cost of $91 million. The project will produce cash inflows of $2.13 million per year for 6 years. The project has the same risk as the firm. The firm has a pretax cost of debt of 6.15 percent and a cost of equity of 1163 percent. The debt-equity ratio is 78 and the tax rate is 35 percent. What is the net present value of the project? Multiple Choice 36 $595,846 $390.218 3688,533 5662051 $567473
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