can you solve those problems please

a) Astra Ltd has 30% debt and 70% equity. Cost of

debt is 12% and the T-bill return is 6%. Market returns

is 13% and beta of Astra Ltd. is 1.3. Tax rate is 30%.

The firm is evaluating a new project that has the same

risk as the overall firm. The cost is estimated at

$68,000 and the expected cash flows from the project

are:

Year

1

2

3

4

Cash Flow

18,000

25,000

35,000

17,000

Should the project be accepted or rejected? Briefly

explain why. (7 marks)

b) The money of shareholders, the principals, is used

by managers, the agents, who promise that the firm will

maximise shareholder wealth. What are the potential

problems with these relationships? (5 marks)

c) What is an efficient market? (1 mark)

Name and describe the three forms of market

efficiency. (3 marks)

d) What are the lessons learned from capital market

history? (1 mark)