Use following information for the next 5 questions

Frieda Inc. is considering a capital expansion project. The initial investment of undertaking this project is $114,500. This expansion project will last for five years. The net operating cash flows from the expansion project at the end of year 1,2,3,4 and 5 are estimated to be $19,850, $24,780, $33,960, $51,236 and $55,780 respectively.

Frieda has a capital structure consisting of 20% debt and 80% equity. The after-tax cost of debt 16% and the cost of equity is 18.5%

1.What is Frieda's weighted average cost of capital

2.Continued from Question 1, based on Frieda's weighted average cost of capital calculated, what is the NPV of undertaking this expansion project? that is, what is the NPV if the weighted average cost of capital is used as the discount rate? Shall Frieda undertake the investment project.

3.Continued from Question 1, based on Frieda's weighted average cost of capital calculated, what is the profitability index of undertaking this project? that is, what is the profitability index if the weighted average cost of capital is used as the discount rate? Shall Frieda undertake the investment project

4.What is the internal rate of return (IRR)

5.What is the modified internal rate of return if Frieda undertakes this project.