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Business, 17.08.2021 22:40 genyjoannerubiera

Downingtown Industries has an overall (composite) WACC of 10 percent. This cost of capital reflects the cost of capital for a Downingtown project with average risk; however, there are large risk differences among its projects. The company estimates that low-risk projects have a cost of capital of 7 percent and high-risk projects have a cost of capital of 18 percent. The company is considering the following projects: Project Expected Return Risk A 15% High B 12 Average C 13 High D 9 Low E 6 Low Which of the projects should the company select to maximize shareholder wealth

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