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SML and Weighted Average (LO1) An all-equity firm is considering the following:The Treasury rate is 5%. The expected return of the market is 11%. A.
SML and Weighted Average (LO1) An all-equity firm is considering the following:The Treasury rate is 5%. The expected return of the market is 11%. A. Which projects have an expected return higher than the company's cost of capital of 11%? B. Which items should be accepted? C. If the company's total cost of capital is used as the minimum expected rate of return, which projects will be wrongly accepted or rejected? |.
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