Focusing on the Le Beau Footwear valuation case, discuss the following:

$1.$ Explain the economic rationale for using the Opportunity Cost of Capital and Return on Investment metrics to estimate the rate of return lost on Le Beaus operation due to the delay in releasing the insurance claim.

$2.$ The consultant at Le Beau Footwears case had to implement three specific adjustments to the estimated cost of capital for the Department Stores Index to arrive at the cost of capital for Le Beau Footwear. What were those adjustments? Why were they necessary? Explain.

$.3.)$ Why were the installments paid by the insurance company compounded at the risk$-$free rate while the insurable loss $($$$1,059,608)$ was compounded at Le Beaus estimated cost of capital?