Calculate the value of the project using the NPV WACC method a Assume that the project has no impact on the companys debt equity ratio b Assume that the company rebalances its debt equity ratio Information Sales $500,000 per year in perpetuity Cash costs 72 of sales Initial Investment $500,000 Tax Rate 34 Project debt equity proportion 25 75 Interest on debt 10 per year Companys geared equity beta 1 8 Market return 5 Risk free rate 3

a Calculate the value of the project using the NPVWACC method assuming that the project has no impact on the companys debtequity ratio Step 1 Calculat...

[SOLVED] Calculate the value of the project using the NPV-WACC method a.

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Question: Calculate the value of the project using the NPV-WACC method a. Assume that the project has no impact on the companys debt-equity ratio b. Assume

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Students Have Also Explored These Related Finance Questions!

Sales	$500,000 per year in perpetuity
Cash costs	72% of sales
Initial Investment	$500,000
Tax Rate	34%
Project debt-equity proportion	25/75
Interest on debt	10% per year
Company’s geared equity beta	1.8
Market return	5%
Risk-free rate	3%