Please answer the following questions based on the information given

Given: You've been looking for a finance internship, and finally found something just right for you. After several interviews you got an offer for a Financial Analyst position at the regional headquarters of "Coffee Cup" coffee shop chain. The company's stock is hundred percent owned by its several cofounders, and the current market price of each of the 500,000 shares of stock is $20. When you started your work, you were immediately assigned a big project. You were asked to evaluate a new investment project: opening a new "Coffee Cup" location in Pomona. Specifically, you were asked to analyze the projected sales revenues and costs and advise your boss on whether the project could be profitable. Below is the information regarding the project: Project life 6 years Initial investment raised solely from $1,200,000 equity Number of "Coffee Cup" customers, 100,000 per year Out of this number, 75% are adults, and 25% are children. Average price that an adult customer $ pays in year 1 This amount will be growing by $0.50 each following year Average price that a child customer $4 pays each year Cost of preparing food and drinks $2 and other variable costs, per each customer's meal Equipment rental and other fixed $210,000 costs, per year Systematic risk (i.e., Beta) of the 11.17 project Corporate tax rate is 34%. The project will fully depreciate on straight line over 6 years. You also know that "Coffee Cup" has three main competitors in the coffee industry, also owned fully by their respective cofounders: Coffeebucks, Coffee Bean, and Pete's Coffee. All but Coffeebucks are comparable in size to "Coffee Cup", with Coffeebucks being roughly twice the size. Coffeebucks' returns are not as prone to economy-wide up or downturns when compared to the returns on an average stock in the economy, and so its systematic risk, measured by Beta, is only 0.657. For Pete's Coffee, though, the systematic risk is higher, with the Beta of 1.051, and it is even higher for Coffee Bean and equals 1.255. You did some research and figured out that the market risk of "Coffee Cup" reflects the Javerage risk of the competitors. Your boss also gave you some data-that might help you in your analysis - on annual returns of the US Treasury bills which are viewed as the riskless asset, as well as for the market portfolio proxied by Standard & Poor's 500 index: Annual returns (%) Treasury bills S&P 500 State of the economy (all equally likely) Boom Normal SO-SO recession 25 3 3 3 12 Based on the information given above, answer the following questions: 1.) (10 points) After analyzing the "Coffee Cup" company's performance over the past years, you have concluded that the company's stock correctly reflects the amount of systematic risk that it has. Based on this, what expected annual rate of return on the company's equity do investors require that would correctly compensate them for the amount of systematic risk? Calculate and explain. 2.) (10 points) What is the weighted average cost of capital for the proposed investment project? Is the project as risky as the company? Calculate and explain. 3.) (10 points) Would you recommend your boss to accept or reject the project? Calculate the net present value of the proposed project and explain all calculations