The city A issued $1,000,000 of 14% coupon, 30 year, semiannual payment, tax exempt municipal bond 10 years ago. The bonds had 10 years of call protection, but now city A can call the bonds if it choose to do so. The call premium would be 10% of the face amount. New 20 years, 12% semiannual payment bonds can be sold at par,but flotation costs on this issue would be 2% or $ 20,000.00
What is the NPV of the refunding