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1. Drag the Low risk and High risk project points so their expected rates of return are 9% and 11%, respectively. If you could choose

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1. Drag the Low risk and High risk project points so their expected rates of return are 9% and 11%, respectively. If you could choose only one project to go forward, which would you choose? a. Project Low because its expected rate of return is higher than its WACC. b. Project Average because its expected rate of return exactly equals its WACC. c. Project High because its expected rate of return is higher than for any of the other projects. d. Any are good choices because the WACC balances the risk. -Select- 2. Now drag the Low risk and High risk project points so their expected rates of return are 7% and 11%, respectively. If you could choose only one project to go forward, which would you choose? a. Project Low because its expected rate of return is close to its WACC. b. Project Average because its expected rate of return equals its WACC and the others are both below their respective WACC's. c. Project High because its expected rate of return is higher than for any of the other projects. d. Any are good choices because the WACC balances the risk. -Select- 3. Now drag the Low risk and High risk project points so the expected rates of return are 10% for all the projects. If you could choose only one project to go forward, which would you choose? a. Project Low because its expected rate of return far exceeds its WACC. b. Project Average because its expected rate of return exactly matches its WACC. c. Project High because its rate of return is below its WACC. d. Any of the projects would be a good choice because they all are expected to return 10%. -Select

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