General Motors (GM) was evaluating the acquisition of Hughes Air appropriate WACC for discounting the projected cash flows for Hughes wa assumed that Hughes was of approximately the same risk as Lockheed contracts and products that were similar to those of Hughes. Comparison Firm BE GM 1.2 Lockheed 0.90 Northrop 0.85 = 1, Note: (i) Target D/E for the acquisition of Hughes (ii) Hughes expected after-tax real asset cash flow next year = $300 mi (iii) Growth rate of cash flows for Hughes = 5% per year forever, (iv) No corporate tax, (v) Appropriate discount rate on debt is the riskless rate of 8% (beta (vi) Expected return on the market portfolio = 14% Compute the WACC of Hughes . O 10.92% O None of these . O 17.44% O 14.92%