Part II $(50\%)$

The company has the following capital structure:

Account $ Costs before tax

Long$-$term Debt $2,000,00010\%$

Preferred Stock $500,00014\%$

Common Stock $2,500,00018\%$

$1.$ Calculate the weighted average cost of capital $($WACC$)$ with a tax rate of $36\%.(20\%)$

$2.$ Using the same cash flows in exhibit I find the NPV$,$ PI$,$ IRR and MIRR $($Use the WACC you have computed above$).$ Which project$($s$)$ would you recommend and why $($show your calculations$)?(30\%)$