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Annual average returns over the past 50 years for Treasury bills and the S&P 500 are 5% and 12%, respectively. Average annual inflation is 3%

Annual average returns over the past 50 years for Treasury bills and the S&P 500 are 5% and 12%, respectively. Average annual inflation is 3% over this same time period. The current risk-free rate is 2%. Which of the following would be an appropriate benchmark for discounting the cash flows of a project whose risk approximates the risk of the market

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