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Consider the following case: Anderson Animations Corporation (AAC) has two divisions, L and H. Division L is the company's low-risk division and wave same size,
Consider the following case: Anderson Animations Corporation (AAC) has two divisions, L and H. Division L is the company's low-risk division and wave same size, the company has a composite weighted average cost of capital of 11%. Division H is considering a project with an expected return of 12%. Should Anderson Animations Corporation (AAC) accept or reject the project? Reject the project Accept the project On what grounds do you base your accept-reject decision? Division H's project should be rejected since its return is less than the risk-based cost of capital for the division. Division H's project should be accepted, as its return is greater than the risk-based cost of capital for the division
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