Business, 06.11.2019 19:31 kordejah348

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 10.8%. 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 $ 650,000 14.0% b 1,050,000 13.5 c 1,000,000 11.2 d 1,200,000 11.0 e 500,000 10.7 f 650,000 10.3 g 700,000 10.2 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

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Marble construction estimates that its wacc is 10% if equity comes from retained earnings. however,...

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