Kelly Industries Is Given the Opportunity to Raise $5 Million

Kelly Industries is given the opportunity to raise $5 million in debt for four years through a local government subsidized program.While Kelly would normally be required to pay 12 percent on its debt issues,the Hampton County program sets the rate at 9 percent.What is the NPV of this subsidized loan? Ignore taxes.

A) $518,364
B) $296,007
C) $384,312
D) $455,602
E) $0