Question 8 15 pts A firm has an after-tax cost of debt of 8%, and 40 % of its assets are financed though debt. The frim has a beta of 1.5. The required rate of return on the market portfolio is 12%, and the risk free rate is 2%. Based on CAMP, what is the WACC of the frim? (Hint: First, compute the cost of equity using CAPM.) O 15.2% 12.8% 13.4% 11.6% Question 15 pts Which of the following statements are true 1. Based on the NPV criteria, a project is desirable if its NPV is greater than zero. 11. Payback Period ignores both the time value of money, and the cash flows beyond the payback period. III. Based on the IRRR criteria, a project is desirable if its IRR is higher than firm's required rate of return. Ill. When comparing two projects, the one with higher profitability will necessarily lead to a higher NPV 11, 11, and IV O I, II and III Oll, and Ill, only I and II, only