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please answer all parts!! Risk-adjusted rates of return using CAPM Centennial Catering, Inc., is considering two mutualy exclusive investments. The company wishes fo use a

please answer all parts!! image text in transcribed
Risk-adjusted rates of return using CAPM Centennial Catering, Inc., is considering two mutualy exclusive investments. The company wishes fo use a CAPM-type riakadiusted discount rate (RADR) in its analysis. Centennials managers belave that the appropriate market rate of return is 11.6%, and they coserve that the current risk-free rate. of retum is 6.8%. Cash flows associated with the two projects are shown in the following table. (Click on the icon here of in order fo copy the contants of the data table beiow into a spreadsheet.) a. Use a risk-adfusted discount rate approach to calculate the net present value of each project, given that project X has an RADR factor of 1 .16 and project Y has an RADR factor of 1.42. The RADR factors are similar to project betas, (Hint: Use the following equation to calculate the required project return for each: r=RF+b(rmRF) ) b. Discuss your findings in part (a), and recommend the preferred project. a. The nisk-adiusted discount rate for proiect X will be %. (Round to two decimal places.)

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