Suppose you have been hired as a financial consultant to assist Electronic Warehouse Ltd, a large, publicly listed company. The company is investigating building a new warehousing facility that is closer to local wholesalers and retailers in Canberra. The company estimates that this capital project will cost $4.5 million. Consider the following current market data on Electronic Warehouse's securities: - Debt: 20250 bonds, 8% coupon rate, 10 years to maturity, currently selling at a discounted price of $800. The bonds have a $1000 par value each and make quarterly coupon payments. - Preference shares: 40500 shares, 9% preference shares in issue selling for $100 per share. - Ordinary shares: 225000 shares in issue, selling for $90 per share; the share's beta coefficient is 1.4. - Market: 12% expected market risk premium; 6% risk-free rate. Electronic Warehouse's tax rate is 28%. Question 9 Calculate the capital budget required to build the new warehousing facility