Use your imagination to describe a fictitious company that is evaluating two dissimilar projects, one typical for that company and one atypical:

1. Describe the typical project
   • What assets will the company buy?
   • What will it do with those assets?
   • What are the sources of funding for the project?
   • What is the project cost of capital? (Just make up a rate, but explain why that rate is appropriate)
2. Describe the atypical project
   • What assets will the company buy?
   • What will it do with those assets?
   • What are the sources of funding for the project?
   • What is the project cost of capital? (Explain what factors make the rate higher/lower than that of the typical project)
3. What potential problems could occur if the company's typical WACC were used as the cost of capital for both projects?