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A company provides you with the following estimates: Below-Average Risk project'sWACC = 8% Average-Risk project'sWACC = 10% Above-average risk project'sWACC = 12% Which of the

A company provides you with the following estimates:

Below-Average Risk project'sWACC = 8%

Average-Risk project'sWACC = 10%

Above-average risk project'sWACC = 12%

Which of the following independent projects should the company accept?

Project A has below-average risk and an IRR=7.75%.

Project B has average risk and an IRR=10.75%.

Project C has above-average risk and an IRR=11.75%.

Both Project B and Project C should be accepted.

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