OPTIMAL CAPITAL BUDGET Hampton Manufacturing estimates that its WACC is 12.5%. The company is considering the following seven investment projects Project Size IRR A $750,000 14.0% B 1,250,000 13.5 C 1,250,000 13.2 D 1,250,000 13.0 750,000 12.7 750,000 12.3 750,000 12.2 a. 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? Project -Select- 4 Project -Select- 4 Project -Select- Project -Select- Project -Select > Project -Select- Project -Select- What is the firm's optimal capital budget? Write out your answer completely. For example, 13 million should be entered as 13,000,000 b. Now assume that Projects C and D are mutually exclusive. Project D has an NPV of $400,000, whereas Project C has an NPV of $350,000. Which set of projects should be accepted? Project -Select* Project -Select- 4 Project -Select4