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Business, 06.03.2020 23:00 KrishnaBalaram1235

1. Marvelous Manufacturing (MM) generated the following information for its capital budgeting manager:

Capital Structure
Project Cost IRR Type of Capital Proportion
W $65,000 15% Debt 30%
X 70,000 13 Common equity 70
Y 75,000 12
Z 70,000 11

MM's weighted average cost of capital (WACC) is 12 percent if the firm does not have to issue new common equity; if new common equity is needed, its WACC is 16 percent. If MM expects to generate $70,000 in retained earnings this year, which project(s) should be purchased? Assume that the projects are independent and indivisible.

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1. Marvelous Manufacturing (MM) generated the following information for its capital budgeting manage...
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