3. Peebon Corporation borrows money at 5% interest rate and the company pays income taxes at 28% rate. Investors wish to earn 16% on its stock. The company has 1 Million shares of common stock outstanding currently trading at $17 per share. The company also has $5 Million debt (bond) outstanding. What is this company's weighted average cost of capital? (10 marks) 4. You have been asked by your CFO to compute the NPV and IRR for an upcoming six-year capital equipment project. She says: the project generates the following cash flows: $50 Million outflow in year zero; $7 Million cash inflow per year in years one through five; $15 Million cash inflow in year six plus the project generates an additional $10 Million cash inflow in year six from the salvage (selling the project equipment for salvage). The CFO tells you: we assume the cash outflow happens at time zero and the cash inflows all happen at the end of each year (example: year one cash flow comes at the end of year one and so forth). The company has a 12% cost of capital. Based on NPV and IRR would