(Question (10)-(18) are sharing the same information] After the recent emissions scandal, Volkswagen is considering a new marketing project to improve its brand image. At time 0, this project requires I an operating expense of $40M to make a TV commercial. Volkswagen plans to air this commercial over the next two years, which costs $30M each year. Thanks to this new commercial, you expect that the firm's revenue will increase by 80.40M in year 1 and by 82.92M in year 2. You want to find the NPV of this project using three different methods. ROUND ANSWERS TO 2 DECIMAL PLACES . Volkswagen's D/E ratio is 2 and the firm plans to keep this ratio fixed.to air this commercial over the next two years, which costs $30M each year. Thanks to this new commercial, you expect that the firm's revenue will increase by 80.40M in year 1 and by 82.92M in year 2. You want to find the NPV of this project using three different methods. ROUND ANSWERS TO 2 DECIMAL PLACES . Volkswagen's D/E ratio is 2 and the firm plans to keep this ratio fixed. . Volkswagen's cost of debt is 3%. Under the current capital structure, the firm's cost of equity is 12% . Volkswagen's corporate tax rate is 50%. Given the information above, the project has the following free cash flows: Year 0 Year 1 Year 2 Free Cash Flow -$20 M $25.20 M $26.46 M PART 1: WACC method Assume that Volkswagen's WACC can be used to discount free cash flows from this marketing project. Here, what is the implicit assumption we make about the project? P SPAN\f\fQUESTION 13 [Question (10)-(18) are sharing the same information] PART II: APV method What is Volkswagen's unlevered cost of capital? For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph Open Sans,sa... V Opt IT ()QUESTION 14 Find the interest expense and interest tax shield each year if the amount of debt for the project is given as the following: Year 0 Year 1 Year 2 Debt amount $32M $16.8M SOM Interest expense Interest tax shield QUESTION 15 [Question (10)-(18) are sharing the same information] What is the present value of the interest tax shield? (Hint: Choose appropriately the discount rate to discount for future interest tax shields (i.e. rIty).) For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph Open Sans, sa... 10pt A V IT ( ) O ?QUESTION 16 [Question (10)-(18) are sharing the same information] Finally, what is the NPV of the project based on the APV method? Show your work. For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). BIUS Paragraph Open Sans, sa... 10pt\f