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PT WIRAGUNA has one proposed project, namely Project A. The finance department has estimated the return on the project in several economic conditions as follows:

PT WIRAGUNA has one proposed project, namely Project A. The finance department has estimated the return on the project in several economic conditions as follows:

The State of the Economy

Probability

Market Return

Project Return A.

Brilliant

Good

Moderate

Bad

0,25

0,20

0,30

0,25

35%

20%

13%

-8%

40%

36%

24%

10%

The risk-free interest rate is estimated at 9%

Based on the above data, calculate: a. Covariance project with market. b. Beta project. c. Required return for the project according to the CAPM. d. Do you have to accept the project, give your reasons.

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