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Using the Risk-Adjusted Discount Rate Method, assume the project cost of capital is 12%. The company estimates a risk-adjustment of 3% for riskier projects and

Using the Risk-Adjusted Discount Rate Method, assume the project cost of capital is 12%. The company estimates a risk-adjustment of 3% for riskier projects and a reduction of 2% for less risky projects. If the company is selecting a less risky project, what discount rate should be used?

a. 15%

b. 14%

c. 12%

d. 10%

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