3. The Ajax Corporation has the following set of projects available to it: INVESTMENT REQUIRED EXPECTED RATE PROJECT* (S MILLION) OF RETURN (%) 500 23.0
3. The Ajax Corporation has the following set of projects available to it: INVESTMENT REQUIRED EXPECTED RATE PROJECT* (S MILLION) OF RETURN (%) 500 23.0 75 18.0 50 21.0 125 16.0 300 14.0 150 13.0 250 19.0 "Note: All projects have equal risk. Ajax can raise funds with the following marginal costs: First $250 million 14.0% Next 250 million 15.5 Next 100 million 16.0 Next 250 million 16.5 Next 200 million 18.0 Next 200 million 21.0 Use the marginal cost and marginal revenue concepts developed in this chapter to derive an optimal capital budget for Ajax
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