Vang Enterprises, which is debt-free and finances only with equity from retained earnings, is considering 7 equal-sized capital budgeting projects. Its CFO hired you to assist in deciding whether none, some, or all of the projects should be accepted. You have the following information: r = 5.00% RPM 5.50%; and b =0.86. The company adds or subtracts a specified percentage to the corporate WACC when it evaluates projects that have above- or below-average risk. Data on the projects are shown below. If these are the only projects under consideration, how large should the capital budget be? Project Risk 1 Very low Low Average High Very high 6 Very high 7 Very high 0. a. 5100 million : $75 million O $150 million d. $25 million e $125 million Risk factor -2.00% -1.00% 0,00% 1.00% 2.00% 2.00% 2.00% Expected return 7.70% 9.20% 10.25% 10.45% 10.90% 11.05% 13.15% Cost (millions) $25 $25 $25 $25 $25 $25 4 $25