NDS Industries Is Evaluating a Project with an Initial Investment

question 22

Multiple Choice

NDS Industries is evaluating a project with an initial investment at Time 0 of $640,000.The present value of the levered cash flows is $729,400 and the net present value of the project is $157,000.Using the flow-to-equity method of valuation determine the amount borrowed.

• A)$89,400
• B)$246,400
• C)$67,600
• D)$54,300
• E)$64,000

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Definitions:

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