Use the following information to answer the question(s) below.
Nielson Motors has a debt-equity ratio of 1.8,an equity beta of 1.6,and a debt beta of 0.20.It is currently evaluating the following projects,none of which would change Nielson's volatility.
(All amounts are in $millions. )
-In order for Nielson Motors to be willing to invest,project 3 must have an NPV greater than:
A) $12.5 million.
B) $15.0 million.
C) $22.5 million.
D) $27.0 million.
Correct Answer:
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