Risky projects can be evaluated by discounting expected cash flows at a risk-adjusted discount rate.

Name: Risky projects can be evaluated by discounting expected cash flows at a risk-adjusted discount rate.
Brand: Quizplus
Rating: 4.7 (48 reviews)

Question

Quizplus · Accepted Answer

This is a commonly used method for evaluating risky projects. By adjusting the discount rate to reflect the level of risk, the net present value of the expected cash flows can be calculated, allowing for a more informed decision about whether to pursue or invest in the project.

Risky Projects Can Be Evaluated by Discounting Expected Cash Flows