1. Project K costs $52,125 at time 0, its expected cash inflows are $12,000 per year for 8 years, and its WACC is 12%. What is the project's IRR? A. 15% B. 16% C. 17% D. 18%
2. Patton Corporation has a target capital structure of 60% debt and 40% common equity, with no preferred stock. Its before-tax cost of debt is 12%, and its tax rate is 40%. The stock price is $22.50. The last dividend was $2.00, and it is expected to grow at a 7% constant rate. What’s its WACC? A. 8.62% B. 9.42% C. 10.92% D. 11.72%
3. A firm considers a project with the following cash flows. What’s its MIRR if WACC=12%? A. 13.10% B. 12.68% C. 11.32% D. 10.72%.