10-19 ADISTING COST OF CAPITAL FORSK Zinge's WACC 10 butto n NC Which projects should get a would be the dollarse of its capital budget Suppose we can raise additional funds beyond increment for partial income of 55 million increase by 15Assuming that we use the projects should it now accept, and what would be the will m batch the WACC which capital 10-19 ADJUSTING COST OF CAPITAL FOR RISK pendent projects for the coming year: Ziege Systems is considering the following inde Project Required Investment $4 million 5 million 3 million 2 million 6 million 5 million 6 million 3 million Rate of Return 14.0% 11.5 9.5 9.0 12.5 12.5 7.0 11.5 Risk High High Low Average High Average Low Low Ziege's WACC is 10%, but it adjusts for risk by adding 2% to the WACC for high-risk proj ects and subtracting 2% for low-risk projects. a. Which projects should Ziege accept if it faces no capital constraints? b. If Ziege can only invest a total of $13 million, which projects should it accept, and what would be the dollar size of its capital budget? c. Suppose Ziege can raise additional funds beyond the $13 million, but each new increment (or partial increment) of $5 million of new capital will cause the WACC to increase by 1%. Assuming that Ziege uses the same method of risk adjustment, which projects should it now accept, and what would be the dollar size of its capital budget