Yulbury plc is listed on the Australian Stock Exchange. Analysts estimate the stock's equity beta to be at 2.17. The ASX 200 Index is expected to earn a return of 15 percent per annum. The T-bill rate is at 5 percent per annum. The firm plans to invest in one of two mutually exclusive projects P or Q. Either project is the same risk as the firm's other assets. The expected cashflows of the two projects are: (a) Calculate the company shareholders' required return. (10 marks) (b) Using the net present value approach, which project should Yulbury plc accept? Assume the discount rate to be the cost of equity capital. (12 marks) (c) The two projects have the same project beta, being 1.52. Derive the projects' required return and advise on project selection using the net present value and the discounted payback period approaches. (12 marks) (d) Assume that the general inflation rate has risen by 25 percentage points. Discuss the impact of this on the cost of equity, the after-tax weighted average cost of capital and on project selection. No calculations are required here