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need help with questions 15 and 16 Question 15 (1 point) A project has an up-front cost of $100,000. The project's WACC is 12 percent
need help with questions 15 and 16
Question 15 (1 point) A project has an up-front cost of $100,000. The project's WACC is 12 percent and its net present value is $10,000. Which of the following statements is most correct? OA) The project should be rejected since its return is less than the WACC. OB) The project's internal rate of return is greater than 12 percent. C) The project's modified internal rate of return is less than 12 percent. OD) All of the statements above are correct. E) None of the statements above is correct. Question 16 (1 point) Suppose a firm uses the WACC as the single Hurdle Rate in determining the value of capital budgeting projects rather than using Risk Adjusted Hurdle Rates. Choose the statement that accurately completes this sentence describing the possible outcomes for the firm: The firm will tend to A) accept profitable, low risk projects and reject unprofitable, high risk projects. B) accept profitable, low risk projects and accept unprofitable, high risk projects. C) reject profitable low risk projects and reject unprofitable high risk projects. OD) become less risky over time. E) reject profitable, low risk projects and accept unprofitable, high risk projects Step by Step Solution
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