Assuming a project has the same risk and financing as the firm,it will have a positive NPV if its rate of return is greater than the firm's WACC.

Question

Quizplus · Accepted Answer

A project with the same risk and financing as the firm will have a positive NPV if its rate of return is greater than the firm's WACC. This is because the WACC represents the minimum rate of return required to compensate investors for the risk of investing in the firm's assets. Therefore, if the project can generate a rate of return higher than the WACC, it will create value for the firm and its shareholders.

Assuming a Project Has the Same Risk and Financing as the Firm,it