1. Sunshine Inc. has two equally-sized divisions. Division A has a beta of 0.8 and Division B has a beta of 1.2. The company is 100% equity financed. The risk-free rate is 6% and the market risk premium is 5%. Sunshine assigns different hurdle rates to each division based on each division's market risk. Which of the following statements is CORRECT? Sunshine's composite WACC is 10%. b. Division B has a lower WACC than Division A. C. If the same WACC is used for each division, the firm would select too many Division A projects and reject too many Division B projects. d. If the same WACC is used for each division, the firm would select too many Division B projects and reject too many Division A projects