An all-equity firm is evaluating a capital project that has the same level of risk as the firm. The project should be accepted if its: (Choose one of the following)

1. internal rate of return exceeds the firms cost of equity capital.

2. expected rate of return exceeds the market rate of return.

3. anticipated rate of return exceeds the firms return on assets.

4. internal rate of return is positive given this level of risk.

5. expected rate of return exceeds the risk-free rate.