Abiword inc has a cost of equity of 12 a pre-tax cost of


AbiWord Inc. has a cost of equity of 12%, a pre-tax cost of debt of 6%, and a tax rate of 35%. The company gets 70% of its financing from equity. As a project manager at the firm, you are trying to decide whether to invest in a project that will have an initial cost of $200 K, and cash inflows of $90 K for years 1 through 4. What is the project’s NPV using the company’s WACC as the discount rate?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Abiword inc has a cost of equity of 12 a pre-tax cost of
Reference No:- TGS02272483

Expected delivery within 24 Hours