1. ABI Construction has a face debt value of $25 Million USDs trading at 93% with a pre-tax weighted cost of 8%. ABI common equity for the year was valued at $59 Million of USDs and preferred equity for $2 Million of USDs. The Preferred equity rate was calculated to be 20%. However, the common equity was to be calculated using CAPM approach, with a 3.5% risk free rate and a 8.5% market risk premium rate, assuming a 1 Beta. If the tax rate is 35%, What is this firm s WACC? Express your answers in strictly numerical terms. For example, if the answer is 5%, write 0.05"

2. Suppose ABI Construction is considering investing in a new project of urban development. The cost of the project is $12 Millions of USD. ABI expects that the non-incremental yearly cash flows from the project are $4 Million of USD for the next five years; e.g. that is $4 Million of USD each year. Using the calculated WACC in the previous question, what is the Net Present Value (NPV) of the project? Note: Express your answers in strictly numerical terms. For example, if the answer is five million dollars, write 5000000 as an answer."