Problems on Decision Criteria for firm-level investment decisions Problem 1 The financial analyst team of XYZ Co. is trying to evaluate two independent projects and make investment decisions. The two projects have the following cash flows: 4 Year Project A -15,000 -10,000 -5,0003,000 8,000 10,000 10,000 Project B | -5.000 | -3.000 |-2000 | | 3.000 | 4.000 | 4.000 1,000 3,000 3,000 XYZ Co. does not plan to raise additional financing for taking new projects. It has a debt-to- assets ratio of 20%. XYZ Co.'s cost of debt financing is 4%. In addition, XYZ Co. has a beta of 12. The market risk-free rate is 2% and the expected stock market return is 7%. Answer the following questions with the given information. Part A: What is the WACC of XYZ Co.? Do not consider the tax impact on WACC. Part B: What are the NPVs of Project A and Project B? Based on your calculation, should XYZ Co. take Project A or Project B or Both! Part C: What are the Profitability Indices of Project A and Project B? Based on your calculation, should XYZ Co. take Project A or Project B or Both? Part D: What are the IRRs of Project A and Project B? Based on your calculation, should XYZ Co. take Project A or Project B or Both? Part E: What are the Payback periods for Projects A and B. If the projects are independent, cash flows are spread evenly throughout the year, and the cut-off is 5.0 years, should you take orn projects A and B? If instead we assume end of year cash flows for years 1-8, what does this do to your payback calculations and decisions