Which of the following is not an appropriate method to adjust hurdle rates for differing investment risks?

Multiple choice question.

Use the cost of capital for representative companies in the industry in which the investment is being considered.

Assign different discount rates to different categories of investments that the firm might undertake.

Calculate a separate cost of capital for each division of the company.

Adjust hurdle rates only when the proposed investment is riskier than the firm's current business.