The minimum acceptable expected rate of return on a project of a specific risk is the:
A)project cost of capital.
B)company cost of capital.
C)risk-free rate of return.
D)project Beta times market risk premium.

Question

Quizplus · Accepted Answer

The minimum acceptable expected rate of return on a project of a specific risk is the project cost of capital, which is the rate of return that the company needs to earn in order to cover the cost of financing the project. It takes into account the risk of the project, the company's cost of capital, and the market conditions. Therefore, options B, C, and D are not correct.

The Minimum Acceptable Expected Rate of Return on a Project