1. A firm is considering a project that requires an investment of $10M in equipment. The equipment will be depreciated using the 3-year MACRS class, but will be used for a five-year project. At the end of the project, the equipment should be worth $3M. The equipment will be used to produce items at a cost of $35 each. Those items will be sold for $60 each. Projected sales are 60,000 each year. Historically, the firm has maintained an inventory to sales ratio of 0.1 (measured in units, not dollars). The firm's marginal tax rate is 35% and its WACC is 12%. Should the firm take the project? Justify your answers

2. Capital restructuring is a corporate operation that involves changing the mixture of debt and equity in a companys capital structure. It is performed in order to optimize profitability or in response to a crisis like bankruptcy, hostile takeover bid, or changing market conditions. With your own words, what are the strategies required to ensure the capital restructuring process going smoothly.

3. Suppose you know that a companys stock currently sells for RM82 per share and the required return on the stock is 12.5 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If it is the companys policy to always maintain a constant growth rate in its dividends, what is the current dividend per share? Explain your answer.