• Question 39 of 57
• Moving to another question will save this response.

Question 39

Langston Labs has an overall (composite) WACC of 10%, which reflects the cost of capital for its average asset. Its assets vary widely in risk, and Langston evaluates low-risk projects with a WACC of 8%, average-risk projects at 10%, and high-risk projects at 12%. The company is considering the following projects:

Project	Risk	Expected Return
A	High	15%
B	Average	12%
C	High	11%
D	Low	9%
E	Low	6%

Which set of projects would maximize shareholder wealth?

	A.	A, B, C, and D
	B.	A and B
	C.	A, B, C, D, and E
	D.	A, B, and C
	E.	A, B, and D