Part 2: Business Analytics (Project B - Essay-based Questions) You are the asset manager of a leading real asset management corporation in Australia, and you have been tasked with conducting and analysing the risks associated with the most recent project. Details of the project are as follows: Type: Commercial - Premium Office Location: Sydney CBD Project gross asset value: $1.2 billion Project size area: 72,000 sqm The abovementioned project is projected with an IRR of 7.0%. Although the IRR at 7.0% of the project is achievable, the project should be approved by the company directors. The financial data for the company is as follow: Total capital = $1.2 billion Return on market = 2.51% I Beta = 0.81 Risk-free rate = 4.02% Interest expenses = $816 million Total liabilities = $7,029 million Income tax expense = $17 million Profits before tax = $519 million To allow company directors to make an inform decision, you are required to provide a business analysis. Your report should include the following seven items: 1. The value of cost of equity (10 marks) 2. The value of cost of debt (10 marks) 3. A recommended funding plan for the abovementioned project (equity and debt) (20 marks) 4. Risk analysis 1: A sensitivity analysis of the cost of debt due to global rate hike cycle of equity and debt financing market (10 marks) 5. Risk analysis 2: A sensitivity analysis of the cost of equity due to global market uncertainties (10 marks)