Marble Construction estimates that its WACC is $10\%$ if equity comes from retained earnings. However, if the company issues new stock to raise new equity, it estimates that its WACC will rise to $10\mathrm{.}8\%.$ The company believes that it will exhaust its retained earnings at $$2,500,000$ of capital due to the number of highly profitable projects available to the firm and its limited earnings. The company is considering the following seven investment projects:

Project Size IRR

A $$650,00014\mathrm{.}0\%$

B $1,050,00013\mathrm{.}5$

C $1,000,00011\mathrm{.}2$

D $1,200,00011\mathrm{.}0$

E $500,00010\mathrm{.}7$

F $650,00010\mathrm{.}3$

G $700,00010\mathrm{.}2$

Assume that each of these projects is independent and that each is just as risky as the firm's existing assets. Which set of projects should be accepted?

Project A

Project B

Project C

Project D

Project E

Project F

Project G

What is the firm's optimal capital budget? Write out your answer completely. For example, $13$ million should be entered as $13,000,000.$

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