Arden Corporation is considering an investment in a new project with an unlevered cost of capital...

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Arden Corporation is considering an investment in a new projectwith an unlevered cost of capital of 9.2 %. ?Arden's marginalcorporate tax rate is 36 %?, and its debt cost of capital is 4.7 %.a. Suppose Arden adjusts its debt continuously to maintain aconstant? debt-equity ratio of 0.5. What is the appropriate WACCfor the new? project? b. Suppose Arden adjusts its debt once peryear to maintain a constant? debt-equity ratio of 0.5. What is theappropriate WACC for the new project? now? c. Suppose the projecthas free cash flows of $ 9.7 million per? year, which are expectedto decline by 2 % per year. What is the value of the project inparts ?(a?) and ?(b?) ?now?

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Arden Corporation is considering an investment in a new projectwith an unlevered cost of capital of 9.2 %. ?Arden's marginalcorporate tax rate is 36 %?, and its debt cost of capital is 4.7 %.a. Suppose Arden adjusts its debt continuously to maintain aconstant? debt-equity ratio of 0.5. What is the appropriate WACCfor the new? project? b. Suppose Arden adjusts its debt once peryear to maintain a constant? debt-equity ratio of 0.5. What is theappropriate WACC for the new project? now? c. Suppose the projecthas free cash flows of $ 9.7 million per? year, which are expectedto decline by 2 % per year. What is the value of the project inparts ?(a?) and ?(b?) ?now?