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= Homework: HW 7 - Chp 18 Question 3, P18-10 (simil... Part 1 of 4 HW Score: 5.56%, 0.33 of 6 points Points: 0 of 1 Save Suppose Alcatel-Lucent has an equity cost of capital of 0.7% market capitalization of $9.94 billion, and an enterprise value of $14 billion. Assume that Alcatel-Lucents debt cost of capital is 64%, its marginal tax rate is 38%, the WACC is 8.0377%, and it maintains a constant debi-equity rato. The firm has a project with average risk. The expected free cash llow, levered value, und debt capacity are as follows: Thus, the NPV of the project calculated using the WACC mothed is $180.71 milion - $100 milion $80.71 million a. What is Alcatel-Lucent's unlovered cost of capital? b. What is the unlevered value of the project? c. What are the interest tax shields from the project? What is their present value? d. Show that the APV of Alcatel-Lucent's project matches the value computed using the WACC method Data Table a. What is Alcatel-Lucent's unlevered cost of capital? Alcatel-Lucent's unlevered cost of capitalism Round to four decimal (Click on the following icon in order to copy its contents into a spreadsheel) Year FCF ( million 100 189.71 55.02 1 49 155.96 45.23 2 100 68.49 19.86 3 74 0.00 D x V 0.00 Print Done Help Me Solve This View an Example Get More