2. The board of directors of Hamilton health plan is considering the following alternative financial structures: A. 30% debt 70% equity B. 40% debt C. 50% debt 50% equity 60% equity The cost of debt is expected to change between 6% and 10% over the range of percentages being considered. Stocks similar to Hamilton are returning dividends and growth yield rates of 10%. The return on high-grade commercial paper is currently 4% but is expected to increase over the next few years. Compute the cost of capital for the three alternatives. Which structure would you recommend to the directors and why? What additional information, if any, would you like to have before making your recommendation? (10 points) 3. CMU Clinic is considering purchasing new lab equipment. The equipment will allow CMU to do in-house several tests that are currently contracted out. This will result in annual savings of $45,000. The equipment will cost $200,000 and require $16,000 annually to maintain. The economic life of the equipment is 8 years and it can be depreciated over its economic life using the straight-line method. The equipment will have no salvage value at the end of 8 years. CMU's investments are currently earning 12%. Should CMU purchase the equipment? At a minimum, calculate the ARR, NPV, and IRR to assist you in your decision. What other information would be helpful in making your decision. (10 points) 4. Discuss the two financial management concepts we have addressed that you found most interesting and why. NOTE: Limit your response to two typecd pages. (10 points)