Question: Consider a project lasting one year only. The initial outlay is $1,000 and the expected inflow is $1,220. The opportunity cost of capital is r=0.22.

Consider a project lasting one year only. The initial outlay is

Consider a project lasting one year only. The initial outlay is $1,000 and the expected inflow is $1,220. The opportunity cost of capital is r=0.22. The borrowing rate is rD=0.12, and the tax shield per dollar of interest is TC=0.21. (Do not round intermediate calculations. Round your answers to 2 decimal places, Leave no cells blank - be certain to enter "0" wherever required.) a. What is the project's base-case NPV? b. What is its APV if the firm borrows 32% of the project's required investment

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