A firm is considering expanding its current operations and has estimated the internal rate of return on that expansion to be 12.2%.The firm's WACC is 11.8%.Given this,you know that the:
A) project will have a lower debt-equity ratio than the firm's current operations.
B) appropriate discount rate for the project is between 11.8% and 12.2%.
C) project has slightly more risk than the firm's current operations.
D) expansion should be undertaken as it has a positive net present value.
Correct Answer:
Verified
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