You finance the project with $8 million in debt at a rate of 6%. What amount do you save in taxes by using debt instead of cash to finance the project?    168,000

Please solve this problem

Suppose your company needs $10 million to build a new assembly line. Your target debt- equity ratio is .4. The flotation cost for new equity is 10 percent, but the flotation cost for debt is only 7 percent. Your boss has decided to fund the project by borrowing money because the flotation costs are lower and the needed funds are relatively small. a. What is your company's weighted average flotation cost, assuming all equity is raised externally? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the true cost of building the new assembly line after taking flotation costs into account? (Do not round intermediate calculations and enter your answer in dollars, not millions, rounded to the nearest whole number, e.g., 1,234,567.) Answer is complete but not entirely correct. 9.73 % a. Flotation cost b. Amount raised 11,010,000 4

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Give me 3 step answer and explanation

2. You plan on buying a bottling machine for $2 million, which can be salvaged for $400,000 in 8 years. Your tax rate is 43% and the CCA rate is 30%. Your cost of capital is 13%. What is present value of the CCA tax sheild? (Answer: E) a. $338,447 b. $378,521 c. $422,781 d. $458, 402 e. $520,348

30) can you please help with this question?

Can I get the answers to 10.11 and 10.12.

use excel 4. A firm is considering a new project that will generate cash revenue of $1,300,000 and cash expenses of $700,000 per year for five years. The equipment necessary for the project will cost $300,000 and will be depreciated straight line over four years. What is the NPV if the firm's marginal tax rate is 35% and discount rate is 10%?

Suppose your company needs $18 million to build a new assembly line. Your target debt- equity ratio is .7. The flotation cost for new equity is 7 percent, but the flotation cost for debt is only 4 percent. Your boss has decided to fund the project by borrowing money because the flotation costs are lower and the needed funds are relatively small. a. What is your company's weighted average flotation cost, assuming all equity is raised externally? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the true cost of building the new assembly line after taking flotation costs into account? (Do not round intermediate calculations and enter your answer in dollars, not millions, rounded to the nearest whole number, e.g., 1,234,567.) a. Flotation cost b. Amount raised GA 5.77 % 19 X