Webster's Latest Project Has an Initial Cost of $1

Multiple Choice

Webster's latest project has an initial cost of $1.23 million and unlevered perpetual cash flows of $238,000.The firm has a debt-equity ratio of .42,a pretax cost of debt of 7.6 percent,a cost of equity of 13.3 percent,and a tax rate of 21 percent.What is the NPV of the project?

A) $864,010
B) $887,982
C) $906,056
D) $909,411
E) $892,020