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Business, 19.11.2019 23:31 amw4

Travis & sons has a capital structure which is based on 40 percent debt, 5 percent preferred stock, and 55 percent common stock. the pre-tax cost of debt is 7.5 percent, the cost of preferred is 9 percent, and the cost of common stock is 13 percent. the company's tax rate is 39 percent. the company is considering a project that is equally as risky as the overall firm. this project has initial costs of $325,000 and annual cash inflows of $87,000, $279,000, and $116,000 over the next three years, respectively. what is the projected net present value of this project?

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