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Business, 18.12.2019 20:31 fgcherubin

Superinc. uses a risk-adjustment when evaluating projects of different risk. its overall (composite) wacc is 7%, which reflects the cost of capital for its average asset. its assets vary widely in risk, and superinc. evaluates low-risk projects with a risk-adjusted project cost of capital of 6.5%, average-risk projects at 7%, and high-risk projects at 7.5%. should the following project be adopted if risk is low, average, or high? col1 time 0 1 2 3 4 5 col2 cf -$1,000 $125 $200 $250 $325a. adopt only if risk is low b. adopt if risk is low or average c. adopt at any of these risk levels d. do not adopt under any of these risk levels

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