The common stock of Buildwell Conversation & Construction Inc. has a beta of .9. The Treasury bill rate is 4%, and the number of market risk premium is estimated at 8%. BCCTs capital structure is 30% debt, paying a 5% interest rate, and 70% equity. Buildwell pays tax at 21%.

a. What is BCCTs cost of equity capital?

b. What is its WAAC?

c. If BCCT is presented with a normal project with an internal rate of return of 12%, should it accept the project?