Analysis of a capital budgeting proposal

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You have just completed the analysis of a capital budgeting proposal and have concluded that the NPV=-5000. (You used a 12% discount rate) Before you decide that the project is not worthwhile, you note that you assumed that all the $400000 in financing needed for the project comes from equity, and that you could easily borrow $200000 to finance the project. If the borrowing is an 8% five-year term loan, would it make any difference to your conclusion?

Reference no: EM131811251

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