Question: Hampton is considering the following projects for the coming year: Project Size ($MM) IRR (%) A 70 13.0 B 105 12.7 C 115 13.2 D

Hampton is considering the following projects for the coming year:

Project

Size ($MM)

IRR (%)

A

70

13.0

B

105

12.7

C

115

13.2

D

125

13.0

E

85

11.7

F

75

12.3

G

80

11.5

Hamptons WACC is 12%. Assume that each of the projects is as risky as the firms existing assets, and Project C and Project D are mutually exclusive while the rest are of the projects are independent. What set of projects should be accepted if NPVC = $20 million and NPVD = $35 million, and what is the firms optimal capital budgeting for the coming year?

Group of answer choices

A, B, C, F ; $365 million

A, C, D ; $310 million

A, B, C, D ; $415 million

A, B, D, F ; $375 million

A, B, C, D, F ; $490 million

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