You are considering undertaking a project where a $$12$ million investment would generate aftertax cash flows of $$3\mathrm{.}5$ million per year for $5$ years. Assume the all$-$equity financing rate for this project is $10\%,$ and that you face a $21\%$ marginal tax rate.

a$.$ What is the NPV and is this a good project?

b$.$ Now assume that you will finance the project by borrowing $$10$ million at a $7\%$ rate, and that the note is repaid at $$2$ million per year $($plus interest on the outstanding principal$)$ for the five year project life. What is the APV?

c$.$ Now assume that you are considering borrowing in Japan. Your rate will be $3\%$ and the Yen is expected to appreciate at $3\%$ per year. The other financing terms will remain the same. What is the new APV?