Takelmer Industries has a different WACC for each of three types of projects. Lowminusrisk projects have a WACC of 8.00%, averageminusrisk projects a WACC of 10.00%, and highminusrisk projects a WACC of 12%. Which of the following projects do you recommend the firm accept?Project Level of Risk IRRA Low 9.50%B Average 8.50%C Average 7.50%D Low 9.50%E High 14.50%F High 17.50%G Average 11.50%

A,D,E,F &G

Explanation:

IRR is the discount rate at which the Net Present value of a project becomes zero and over this rate the Net present value become negative. All the Projects with IRR Less than the relevant WACC will not be acceptable.

WACC

High = 12%

Average = 10%

Low = 8%

Compare all of the above WACC with each of the relevant WACC to find whether a project is acceptable or not.

Project Level of Risk IRR    Relevant WACC     Acceptable

A             Low       9.50%                8%                    Yes

B           Average   8.50%                10%                  No

C           Average   7.50%                10%                  No

D           Low          9.50%                8%                  Yes

E           High         14.50%                12%                  Yes

F           High         17.50%                12%                  Yes

G           Average  11.50%                10%                  Yes

lawyer < 3 love yahh vic. imu