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The common stock of Buildwell Conservation & Construction Incorporated ( B C C l ) has a beta of 0 . 9 . The Treasury

The common stock of Buildwell Conservation & Construction Incorporated (BCCl) has a beta of 0.9. The Treasury bill rate is 4%, and the market risk premium is estimated at 9%. BCCl's capital structure is 34% debt, paying an interest rate of 9%, and 66% equity. The debt sells at par. Buildwell pays tax at 21%.
a. What is BCCl's cost of equity capital?
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
b. What is its WACC?
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
c. If BCCl is presented with a normal project with an internal rate of return of 12%, should it accept the project if it has the same level of risk as the current firm?
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