1. Masulis, Inc. is considering a project that has the following cash flow and WACC data. What is the project's discounted payback (rounded to two decimal places)? WACC: 10.00% Year 0 1 2 3 4 Cash flows −$950 $525 $485 $445 $405 Select one: a. 2.22 years. b. 2.44 years. c. 1.61 years. d. 1.88 years.

2. Assume a project has normal cash flows, with one outflow at the beginning of the project, followed by a series of inflows. Holding all else equal, which of the following statements is CORRECT? Select one: a. A project's regular payback increases as the WACC declines. b. A project's IRR increases as the WACC declines. c. A project's NPV increases as the WACC declines. d. A project's MIRR is unaffected by changes in the WACC.