Jeff and Co. has no debt or preferred stock, it uses only equity capital, and has two equally sized divisions. Division X's cost of capital is 10.0%, Division Y's cost is 15.0%, and the corporate (composite) WACC is 12.50%. All of Division X's projects are equally risky, as are all of Division Y's projects. However, the projects of Division X are less risky than those of Division Y. Which of the following projects should the firm accept? Jeff and Co. has no debt or preferred stock, it uses only equity capital, and has two equally sized divisions. Division X's cost of capital is 10.0%, Division Y's cost is 15.0%, and the corporate (composite) WACC is 12.50%. All of Division X's projects are equally risky, as are all of Division Y's projects. However, the projects of Division X are less risky than those of Division Y. Which of the following projects should the firm accept