Question: A company is analyzing two projects. Project A has a project beta of 1.2, and Project B has a beta of 0.6. The company's weighted

A company is analyzing two projects. Project A has a project beta of 1.2, and Project B has a beta of 0.6. The company's weighted average cost of capital is 10%. The risk-free rate is 5%, and the market risk premium is 10%. If the company incorrectly uses the company's weighted average cost of capital to calculate the NPV of both projects, will it overestimate or underestimate the NPV?

A. Overestimate NPV for both projects.

B. Underestimate NPV for both projects.

C. Overestimate one NPV, but not both projects.

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