Marble Construction estimates that its WACC is 10% if equity comes from retained earnings. However, if the company issues new stock to raise new equity, it estimates that its WACC will rise to 10.8%. The company believes that it will exhaust its retained earnings at $2, 500,000 of capital due to the number of highly profitable projects available to the firm and its limited earnings. The company is considering the following seven investment projects: Assume that each of these projects is independent and that each is just as risky as the firm's existing assets. Which set of projects should be accepted? What is the firm's optimal capital budget? Write out your answer completely. For example. 13 million should be entered as 13,000,000. $ ____ You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $230,000, and it would cost another $34, 500 to modify the equipment for special use by the firm. The equipment falls into the MACRS 3-year class and would be sold after 3 years for $92,000. The applicable depreciation rates are 33%, 45%, 15%, and 7%. The equipment would require an $10,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm $72,000 per year in before-tax labor costs. The firm's marginal federal-plus-state tax rate is 40%. a. What is the initial investment outlay for the spectrometer, that is. what is the Year 0 project cash flow? Round your answer to the nearest cent. Negative amount should be indicated by a minus sign. $ ____. b. What are the project's annual cash flows in Years 1, 2, and 3? Round your answers to the nearest cent. In Year 1 $ ___ In Year 2 $ ____ In Year 3 $ ____ c. If the WACC is 13%, should the spectrometer be purchased