The Cost of Capital for a Project in Spain Should

Multiple Choice

The cost of capital for a project in Spain should ______.

A) be a function of the riskiness of the project
B) equal the minimum rate of return necessary to induce investors to buy or hold the firm's stock
C) equal the nominal required return for a similar U.S. investment
D) equal the parent's weighted average cost of capital
E) equal the rate used by Spanish investors to capitalize corporate cash flows