How do I find the irr, npv, cost debt, cost of equity, wacc, project's cash in years 17 and 20

Hyunda Motors is considering increasing production of the Freebird sedan at their Georgia assembly plant. You have been provided the following pieces of information.

a. The expansion will require the purchase of machinery costing $40,000,000

b. The firm has spent $250,000 to train workers to use the new machinery.

c. The sales from this project will be $15 million per year, of which 10% comes from lost sales of the TXI sedan. No additional operating expenses or costs are incurred.

d. The company uses straight-line depreciation. The project has an economic life of 20 years and the machinery will a salvage value of $4,000,000.

e. Because of the project, the company will need additional working capital of $1,500,000 which can be liquidated at the end of 20 years.

f. HM’s stock price is $34.50. They just paid a dividend of $3 and the market consensus is for constant 5% dividend growth forever.

g. HM’s bonds sell for $970. They pay semi-annually, have 7 years to maturity, a coupon rate of 4% and par value of $1,000.

h. HM’s marginal tax rate is 40%.

i. Their target capital structure is 70% equity and 30% debt.
Asked Apr 19, 2014

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