P12-1 Adjusting for Risk Docs R Us has performed a risk assessment of independent projects. They adjust for project risk by raising the calculated IRR by 3% for low risk projects, leaving the IRR the same for moderate risk projects, and lowering the calculated IRR by 2% for high risk projects. Without capital rationing, and given their cost of capital of 11%, which projects should Meds R Us accept? Why? Note that you will add 3% to the Project's IRR if it is low risk (making it look more favorable since it is), leave Average risk Projects' IRRs the same, and subtract 2% from the IRR for high risk Projects (making them less favorable since they are due to the risk) Risk NPV $5,000 $4,000 $2,000 $4,000 $-1,000 IRR 11% 16% 12% 17% 9% Project Cost $21,000 $17,000 $15,000 $14,000 $4,000 Level High Average High Low Low