South Melbourne Holdings Ltd is a diversified industrial firm whose overall WACC is 6.5%. It is considering three independent projects, Projects A, B and C. Project A is in its grocery division, Project B is in its automotive division and Project C is in its mining division. The expected returns from these projects are 6.6%, 8.1% and 12.7% respectively. The costs of capital for each division, based on the beta of firms in the respective industries, are 3.8%, 10.5% and 14.2% respectively. Which projects should the firm accept?

Select one:

a.All three projects

b.Project A and B only.

c.Project A only.

d.None of the projects