The company has the following capital structure: Initial investment $2,000

Account $ Costs before tax

Long-term Debt 2,000,000 10%

Preferred Stock 500,000 14%

Common Stock 2,500,000 8%

1. Calculate the weighted average cost of capital (WACC) with a tax rate of 36%.
2. Using the same cash flows in exhibit I find the NPV, PI, IRR and MIRR (Use the WACC you have computed above). Which project(s) would you recommend and why (show your calculations)?

*** Please show calculations for question 1 and 2 and show how you calculated NPV, PI, IRR and MIRR not just answers please show formulas Thank you!!