In its third year, a project is expected to generate EBIT of $453,100 and tax rate is 40%. Depreciation expenses are expected to be $44,038, capital expenditures are expected to be $153,003, and net working capital is expected to increase by $48,065. What is the projects expected free cash flow for the year?

A)

$203,588

B)

$210,960

C)

$132,375

D)

$122,884

E)

$114,830

Percy Motors has a target capital structure of 40% debt and 60% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 9%, and its tax rate is 40%. Percy's CFO estimates that the company's WACC is 9.96%. What is Percy's cost of common equity?

A)

10%

B)

11%

C)

13%

D)

9%

E)

15%