LaPango Inc estimates that its average risk projects have a WACC of 10 , its below average risk projects have a WACC of 8 , and its above average risk projects have a WACC of 12 Which of the following projects (A, B, and C) should the company accept a All of the projects should be accepted b Project A, which is of average risk and has a return of 9 c Project B, which is of below average risk and has a return of 8 5 d None of the projects should be accepted e Project C, which is of above average risk and has a return of 11

Question

LaPango Inc  estimates that its average risk projects have a WACC of 10 , its below average risk projects have a WACC of 8 , and its above average risk projects have a WACC of 12   Which of the following projects (A, B, and C) should the company accept  a  All of the projects should be accepted  b  Project A, which is of average risk and has a return of 9   c  Project B, which is of below average risk and has a return of 8 5   d  None of the projects should be accepted  e  Project C, which is of above average risk and has a return of 11

Accepted Answer

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	a.	All of the projects should be accepted.
	b.	Project A, which is of average risk and has a return of 9%.
	c.	Project B, which is of below-average risk and has a return of 8.5%.
	d.	None of the projects should be accepted.
	e.	Project C, which is of above-average risk and has a return of 11%.

Question

LaPango Inc. estimates that its average-risk projects have a WACC of 10%, its below-average risk projects have a WACC of 8%, and its above-average risk

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