An all-equity firm is considering the projects shown as follows.The T-bill rate is 3 percent and the market risk premium is 6 percent.If the firm uses its current WACC of 12 percent to evaluate these projects,which project(s)will be incorrectly rejected?

A)Project A
B)Projects B and C
C)Project D
D)Project B

Question

An all-equity firm is considering the projects shown as follows.The T-bill rate is 3 percent and the market risk premium is 6 percent.If the firm uses its current WACC of 12 percent to evaluate these projects,which project(s) will be incorrectly rejected?

A)Project A 
B)Projects B and C 
C)Project D 
D)Project B

Quizplus · Accepted Answer

The Answer of An all-equity firm is considering the projects shown as follows.The T-bill rate is 3 percent and the market risk premium is 6 percent.If the firm uses its current WACC of 12 percent to evaluate these projects,which project(s)will be incorrectly rejected?

A)Project A 
B)Projects B and C 
C)Project D 
D)Project B

An All-Equity Firm Is Considering the Projects Shown as Follows