chandsingh

*If the company issues new stock.
Only projects A, B, and D will be taken since their IRRWACC
The total investment is $4,000,000 which is equal to retained earnings
They could fund more investment than that if they wanted to but they don’t have attractive opportunities.
Since they have enough retained earnings to fund the investment, they won’t need to issue new stock. Since they won’t have to issue new stock, you shouldn’t include that cost when calculating WACC