Harris Inc. is a book publisher that is considering developing an$$ e$-$reader. The project requires $270($$ thousand$)$ in capital expenditures upfront. The production will continue for two$$ years, and the FCFs in years $1$ and $2$ are $150$ and $170($in $$$ thousand$).$ The tax rate is$50\%.$ The asset cost of capital for the book publishing industry is$8\%.$ Harris$$s cost of debt is$6\%.$

Turbo Inc. is a public firm that sells$$ e$-$readers. It has a$$ debt$-$to$-$value ratio$1/2.$ Its equity cost of capital is$22\%$ and its debt cost of capital is$4\%.$

$($a$)$ What is the NPV of the project if it is entirely financed with equity$($in $$$ thousand$)?$

$$

$14\mathrm{.}52($Round to two decimal$$ places.$)$

$($b$)$ What is the NPV of the project if Harris maintains a fixed$$ D$/$E ratio of$1/1$ and finances the project with this$$ D$/$E ratio$($in $$$ thousand$)?$

$$

negative $2\mathrm{.}27($Round to two decimal$$ places.$)$