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the answer, please Nizwa renewable energy project is an independent project sponsored by Oman Oil company. The following data is available for Oman Oil: Beta

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Nizwa renewable energy project is an independent project sponsored by Oman Oil company. The following data is available for Oman Oil: Beta is 2.00. Debt is 25% and Equity is 75%. Cost of debt is 8%. Tax rate 20%. Nizwa renewable energy is planning a debt finance of 70%. It plans to raise a 100 million from banks using an 10 year installment term loan. Each year Nizwa will pay 17.70 million as annual installment. Tax rate for Nizwa is 30%. Betas of three other renewable energy projects are given below beta equity financing percentage AAA 2.75 35% BBB 2.50 25% CCC 3.00 20% Assume risk free rate is 5%, and market rate of return is 18%. a) Calculate WACC assuming sponsor's wacc is to be used b) Calculate WACC assuming sponsor's wacc should not be used Nizwa renewable energy project is an independent project sponsored by Oman Oil company. The following data is available for Oman Oil: Beta is 2.00. Debt is 25% and Equity is 75%. Cost of debt is 8%. Tax rate 20%. Nizwa renewable energy is planning a debt finance of 70%. It plans to raise a 100 million from banks using an 10 year installment term loan. Each year Nizwa will pay 17.70 million as annual installment. Tax rate for Nizwa is 30%. Betas of three other renewable energy projects are given below beta equity financing percentage AAA 2.75 35% BBB 2.50 25% CCC 3.00 20% Assume risk free rate is 5%, and market rate of return is 18%. a) Calculate WACC assuming sponsor's wacc is to be used b) Calculate WACC assuming sponsor's wacc should not be used

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