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event such as the credit crisis of 2008, where interest rates for many corporate borrowers climbed quite high, affect the size of the capital budget?...

In terms of Figure 13-5 (attached), how would an event such as the credit crisis of 2008, where interest rates for many corporate borrowers climbed quite high, affect the size of the capital budget? In terms of Figure 13-5 what will happen to WACC and IRR. Where will the new equilibrium be?

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Whenever there is a credit crisis like that of 2008, the WACC curve will shift towards left.
This means at a particular capital spending, the return needed is increased and hence the project
might...

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