A project is expected to generate $10M in sales next year. The annual costs are expected to be 30% of sales. The tax rate is 20%. The after-tax cash flow is expected to remain constant forever. The initial investment is $14.74M in debt and $35.26M in equity. The target debt ratio for the project is 25%. The unlevered cost of capital is 10% and the cost of debt is 5%. Find the NPV of the project using the FTE method.

Real estate means ownership of land along with the assets and natural resources that exist on the land. These properties are in real/physical form which is tangible. Real estate simply means land or addition made to land permanently like constructing a r…