Suppose$$ Alcatel$-$Lucent has an equity cost of capital of $9\mathrm{.}1\%,$ market capitalization of $ $9\mathrm{.}66$billion$,$ and an enterprise value of $ $14$ billion. Suppose$$ Alcatel$-$Lucent's debt cost of capital is $6\mathrm{.}8\%$ and its marginal tax rate is $34\%.$

a$.$ What is$$ Alcatel$-$Lucent's WACC?

b$.$ If$$ Alcatel$-$Lucent maintains a constant$$ debt$-$equity ratio, what is the value of a project with average risk and the expected free cash flows as shown$$ here, LOADING...$?$

c$.$ If$$ Alcatel$-$Lucent maintains its$$ debt$-$equity ratio, what is the debt capacity of the project in part $($b$)?$

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Part $1$

a$.$ What is$$ Alcatel$-$Lucent's WACC?

$$Alcatel$-$Lucent's WACC is

$$

enter your response here$\%.($Round to two decimal$$ places.$)$

Alcatel$-$Lucent's WACC is$($Round to two decimal places.$)$

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Data table

$($Click on the following icon in order to copy its contents into a$$ spreadsheet.$)$

Year

$0$

$1$

$2$

$3$

FCF $($$ million$)$

negative $100$

$46$

$97$

$65$