Question: Consider a project lasting one year only. The initial outlay is $1,500 and the expected inflow is $1,800. The opportunity cost of capital is r

Consider a project lasting one year only. The initial outlay is $1,500 and the expected inflow is $1,800. The opportunity cost of capital isr= .20. The borrowing rate isr_D= .10, and the tax shield per dollar of interest isT_c= .40.(Leave no cells blank - be certain to enter "0" wherever required. A negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)

a.What is the projects base-case NPV?

Base-case NPV$

b.What is its APV if the firm borrows 35% of the projects required investment?

Adjusted present value$

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