QUESTION 14 'Modigliani Manufacturing has a target debt-equity ratio of .50. Its cost of equity is 18 percent and its cost of debt is 11 percent. If the tax rate is 35 percent, what is Modigliani's WACC? 14.38% 16.31% 18.92% 20.55% 22.34% QUESTION 15 Sallinger, Inc., is considering a project that will result in initial aftertax cash savings of $4 million the end of the first year, and these savings will grow at a rate of 5 percent per year indefinitely. The firm has a target debt-equity ratio of 75. a cost of equity of 16 percent, and an aftertax cost of debt of 6 percent. The cost-saving proposal is somewhat riskier than the usual project the firm undertakes; management uses the subjective approach and afsplies an acjustment factor of 2 percent to the cost of capital for such risky projects. At what level of project costs (investment costs) the Sallinger project would have a zero NPV? 37901639 39901639 41901639 43901639 45901639