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Firm Q estimates that the operating beta of a U.S.-based proxy firm for a Swiss project is 0.60 and that Switzerland has no significant political

Firm Q estimates that the operating beta of a U.S.-based proxy firm for a Swiss project is 0.60 and that Switzerland has no significant political risk. Assuming the country beta for Switzerland is 0.75 and that the long-term USD risk-free rate is 3%, the global market risk premium is 5%. What is Firm Qs hurdle rate for the Swiss project based on GCAPM?

10.10%

12.00%

5.25%

8.66%

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