Question 14 (1 point) Listen A project will cost $50,000 to initiate and will generate real cash flows of $40,000 in each of the next two years. The nominal discount rate has been estimated to be 10 percent per year. Expected inflation is 4 percent over the next two years. What is the NPV of the project? a) $19,421.49 b) $21,573.55 c) $23,573.55 d) $25,496.63 Question 19 (1 point) Listen Canadian Auto Shop Services has an opportunity to invest $550,000 in a new project that will generate additional operating profit of $200,000 per year. The asset has a six-year life, a CCA rate of 30 percent, and an expected salvage value of $60,000. The project has a beta of 1.5. The company's cost of capital is 12 percent and marginal tax rate is 35 percent. The risk-free rate is 4.5 percent and the market risk premium is 6 percent. Assume the asset class remains open after the asset is sold. What is the project's NPV? a) $108,680 b) $137,415 c) $384,655 d) $425,214