Ch 10: End-of-Chapter Problems-LPK - The Cost Who wins LSU-Bama Sett eBook Ziege Systems is considering the following independent projects for the coming year: Required Investment Rate of Return Project Risk "$4 million 13.00% 10.50 High High 0 2 5 million 1 3 million 8.50 Low 2 million 8.00 Average 6 million 11.50 High 2 5 million 11.50 Average 6 million 6.00 Low 3 million 11.00 Ziege's WACC is 9.00%, but it adjusts for risk by adding 2% to the WACC for high-risk projects and subtracting 2% for low-risk projects. Projects a. Which projects should Ziege accept if it faces no capital constraints? 3 Project A Reject : Project A Reject & Project B Accept : OBS OAO7 wi pix] 11.00 LITU. CH-Ur-claper Pruum-LP - The USL UT Capital 3 million Low Ziege's WACC is 9.00%, but it adjusts for risk by adding 2% to the WACC for high-risk projects and subtracting 2% for low-risk projects. a. Which projects should Ziege accept if it faces no capital constraints? Reject Accept Project A Project B Project C Project D Project E Reject ! Accept Reject Project F Rat Accept Project G Reject Project H b. If Ziege can only invest a total of $13 million, which projects should it accept? Project A Reject Accept Project B Reject Project Project D Project E Accept Rejecte Refect If Ziege can only Invest a total of $13 million, what would be the dollar size of its capital budget? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Round your answer to two decimal places. million c. Suppose Ziege can raise additional funds beyond the $13 million, but each new increment (or partial increment) of $5 million of new capital will cause the WACC to increase by 1%. Assuming that Ziege uses the same method of risk adjustment, which projects should it now accept? Project A -Select- Project B Select Project -Select Project D Project E Project F Project G -Select- Project H What would be the dollar size of its capital budget? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Round your answer to two decimal places. million