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Kiwi Helicopters Ltd has a target capital structure of 70%ordinary common shares and 30% debt. They issued a twenty-year, 5%bond 10 years ago. The bond currently has a yield-to-maturity of7.5%. The ordinary common shares are currently selling for $45.They have a beta of 1.75 and are expected to pay a $3.25 dividendnext year. The firm has a 30% marginal tax rate. The market has anexpected return of 12%. Treasury bills are currently paying 2%.Required: (a) Calculate the appropriate discount ratefor the average project for Kiwi Helicopters Ltd. Kiwi Helicopters Ltd is considering a project that will provideafter-tax cash flows of $225,000 for the next 7 years. The projectwill cost $1,000,000 and will have a salvage value of $200,000.Required: (b) Should they do the project? Show yourworkings and justify your answer.