2) Which of the following is NOT a specific financing option for temporary working capital

Question B1 a) The management of George and Associates wants to expand its operations to other cities in Scotland. They are considering 5 locations with the following project proposals. The proposal for each location is summarised below: Project Glasgow Stirling Inverness Aberdeen Dundee Initial Investment(000) 30 90 45 36 54 Annual Revenue(000) 60 90 54 51 24 Annual Fixed Life of Costs(000) Project(Year) 15 3 30 5 18 4 24 10 6 15 Variable costs are 40 per cent of annual revenue for all projects. Each project can only be undertaken once, and each is divisible. The cash flows are confined to within the lifetime of each project. Apart from initial investments that occur at the beginning of the project, all cash flows occur at year end. Projects in Aberdeen and Dundee are mutually exclusive. The cost of capital is 10 per cent. Assume no inflation and no tax. Answer the following: i. Calculate the NPV for each proposed location. (15 marks) ii. If the firm has a limit of 120,000 for investment in projects at Time 0, what is the maximum net present value obtainable? (10 marks) b) Moonlight Plc has no debt. The company can borrow at 8%, the firm's WACC is 12%, and the tax rate is 28%. Answer the following: i. ii. What is Moonlight Plc's cost of equity capital? (5 marks) If the firm converts to a capital structure of 25% debt, what will its cost of equity be? (5 marks) iii. What is Moonlight Plc's WACC in part (ii)