The Robinson Corporation has $43 million of bonds outstandingthat were issued at a coupon rate of 12.550 percent seven yearsago. Interest rates have fallen to 11.750 percent. Mr. Brooks, theVice-President of Finance, does not expect rates to fall anyfurther. The bonds have 17 years left to maturity, and Mr. Brookswould like to refund the bonds with a new issue of equal amountalso having 17 years to maturity. The Robinson Corporation has atax rate of 30 percent. The underwriting cost on the old issue was4.30 percent of the total bond value. The underwriting cost on thenew issue will be 2.60 percent of the total bond value. Theoriginal bond indenture contained a five-year protection against acall, with a call premium of 6 percent starting in the sixth yearand scheduled to decline by one-half percent each year thereafter.(Consider the bond to be seven years old for purposes of computingthe premium.) Use Appendix D for an approximate answer butcalculate your final answer using the formula and financialcalculator methods. Assume the discount rate is equal to theaftertax cost of new debt rounded up to the nearest whole percent(e.g. 4.06 percent should be rounded up to 5 percent)

a. Compute the discount rate. (Do not round intermediatecalculations. Input your answer as a percent rounded up to thenearest whole percent.)
  

b. Calculate the present value of totaloutflows. (Do not round intermediate calculations and roundyour answer to 2 decimal places.)
  

c. Calculate the present value of totalinflows. (Do not round intermediate calculations and roundyour answer to 2 decimal places.)
   

d. Calculate the net present value.(Negative amount should be indicated by a minus sign. Donot round intermediate calculations and round your answer to 2decimal places.)