According to a survey carried out by Gitman and Forrester that was published in 1977, the most common way for businesses in the United States to deal with risk in capital budgeting decisions is by
A) ignoring it.
B) using the certainty-equivalent method.
C) using the risk-adjusted discount rate method.
D) using the expected utility method.

Question

Quizplus · Accepted Answer

The most common way for businesses in the United States to deal with risk in capital budgeting decisions, according to the survey by Gitman and Forrester, is by using the risk-adjusted discount rate method. This approach adjusts the discount rate to reflect the risk level of the project, making it a popular choice for incorporating risk into capital budgeting.

According to a Survey Carried Out by Gitman and Forrester