a. According to the CFO of Kansas City Southern (KSU), the railroad spent $175 million in 2009 to rebuild an abandoned rail line in order to provide the railroad with ready access to growing markets in Mexico (where U.S. auto manufactures have been building news plants). The railroad predicts a free cash ow of $24 million per year from the project. From the standpoint of net present value, do you think this is a good investment? To begin, the company's WACC was 8.23% from 2009 through 2015. You will need its WACC from 2016 onward. To guide your analysis, please see the railroad's Value Line summary page on Blackboard under \"KSU 2016,\" which includes KSU's (financial) capital structure and estimated beta. The company's bond rating is \"BBB,\" as assessed by Standard 8: Poor's Corporation, with an interest rate of 5.3%. For ease of estimation, assume a corporate tax rate of 35%. Please show all your work. (Hint: To estimate the WACC, you will need the cost of equity from the estimates of the capital asset pricing model in problem 1. Because the KSU data are annual but the CAPM data are monthly, you will have to annualize the CAPM estimates before estimating KSU's cost of equity.) b. In what year does the internal rate of return exceed the WACC? 1What do you conclude by comparing the internal rate of return to a less formal means of estimating the cost of capital, such as the cm'rent interest rate on the bonds plus three percentage points? What do you conclude about the profitability of the project now? Please show your work