SupposeAlcatel-Lucent has an equity cost of capital of 9.4 %9.4%, market capitalization of $ 11.20$11.20 billion, and an enterprise value of $ 16.0$16.0 billion with a debt cost of capital of 6.7 %6.7% and its marginal tax rate is 35 %35%. a. What isAlcatel-Lucent's WACC? b. IfAlcatel-Lucent maintains a constantdebt-equity ratio, what is the value of a project with average risk and the following expected free cashflows?

Year	0	1	2	3
FCF ($ million)	negative 100100	5151	105105	7171

c. IfAlcatel-Lucent maintains itsdebt-equity ratio, what is the debt capacity of the project in part (b)? a. What isAlcatel-Lucent's WACC? Alcatel-Lucent's WACC is 7.897.89%. (Round to two decimalplaces.) b. IfAlcatel-Lucent maintains a constantdebt-equity ratio, what is the value of a project with average risk and the following expected free cashflows?

Year	0	1	2	3
FCF ($ million)	negative 100100	5151	105105	7171

The NPV of the project is $94.0194.01 million.(Round to two decimalplaces.) c. IfAlcatel-Lucent maintains itsdebt-equity ratio, what is the debt capacity of the project in part (b)? The debt capacity of the project in part (b) is asfollows:(Round to two decimalplaces.)

Year	0	1	2	3
Debt capacity	$52.3952.39 million	$nothing million	$nothing million	$0.000.00 million