8.The expected return on CA s equity is 2%, and the firm has a yield to maturity on its debt of 4%. Debt accounts for 19%, common equity for 75% and preferred equity for 6% of CA s total market value. If its tax rate is 40%, and the cost of preferred equity is 40%, What is this firm s WACC? Express your answers in strictly numerical terms. For example, if the answer is 5%, write 0.05

9.ABI Construction has a face debt value of $20 Million USDs trading at 90% with a pre-tax weighted cost of 7%. ABI common equity for the year was valued at $50 Million of USDs and preferred equity for $3 Million of USDs. The Preferred equity rate was calculated to be 20%. However, the common equity was to be calculated using CAPM approach, with a 3% risk free rate and a 8% market risk premium rate, assuming a 1 Beta. If the tax rate is 35%, What is this firm s WACC

10.Suppose ABI Construction is considering investing in a new project of urban development. The cost of the project is $10 Millions of USD. ABI expects that the non-incremental yearly cash flows from the project are $3 Million of USD for the next five years; e.g. that is $3 Million of USD each year. Using the calculated WACC in the previous question, what is the Net Present Value (NPV) of the project?