1.ABC Inc. borrows money at 8%, sells bonds at 7%, and the purchasers of common stock require 14% rate of return. If the company has borrowed $40 million, sold $60 million in bonds, and sold $100 million worth of common stocks, what is the Weighted Average Cost of Capital (WACC)?

2.

A project has two IRR: -12.2% and 12.66%. The IRR which is valid and useful is:

Enter the answer as a percentage. For example, 12.34% must be entered as 12.34. Keep 2 decimal places and do not enter the percentage symbol.

3.

A company has the following cash flow (in millions of dollars):

EOY	(in millions of $)
0	-4.50
1	4.00
2	3.00
3	2.00
4	1.00
5	-1.00
6	-2.00
7	-3.00

If the firm borrows money at 8% and invests money at 15%, find the Modified Internal Rate of Return (MIRR).

4.

In determining MARR, opportunity cost is (check all that apply):

Cost of the best opportunity forgone

Cost of the best project

Rate of return of the best rejected project

Rate of return of the best project

Rate of return of the worst project